Larman v Homolka

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

JUDICIAL REVIEW AND APPEALS LIST

S ECI 2023 03282

JAMES LARMAN	Plaintiff
v
DRS SUSANNE HOMOLKA CONSTITUTING THE MEDICAL PANEL PURSUANT TO THE WRONGS ACT 1958 (VIC) (and others according to the attached Schedule)	Defendants

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JUDGE:	Ginnane J
WHERE HELD:	Melbourne
DATE OF HEARING:	12 June 2024
DATE OF JUDGMENT:	5 December 2024
CASE MAY BE CITED AS:	Larman v Homolka
MEDIUM NEUTRAL CITATION:	[2024] VSC 756

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JUDICIAL REVIEW – Medical Panel – Alleged jurisdictional errors – Panel’s duty to disregard impairment from unrelated injuries or causes – Whether Panel erred in identification of impairment from unrelated injury or cause – Whether finding that impairment from unrelated injuries or causes was playing a part in plaintiff’s current impairment – Alleged factual errors – Wrongs Act 1958 s 28LL(3).

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Ms F Spencer SC Ms J Cowen	Slater & Gordon
For the First Defendant	No appearance	DLA Piper
For the Second Defendant	Ms R Kaye KC Ms S Gold	Minter Ellison
For the Third Defendant	As above	Meridian Lawyers
For the Fourth Defendant	As above	Kennedys (Australasia) Partnership

HIS HONOUR:

The plaintiff, Mr James Larman, seeks judicial review of a certificate of determination of a medical question by a Medical Panel dated 23 May 2023. The medical question and the determination were:

Question: Does the degree of impairment resulting from the physical injury to the claimant alleged in the claim satisfy the threshold level?

Answer: The Panel determined that the degree of whole person impairment resulting from the physical injury to the claimant alleged in the claim does not satisfy the threshold level.

The Panel consisted of the first defendant, who is an occupational and environmental physician. Dr Peter Burke, a general surgeon, was a consultant to the Panel and participated in its examination of the plaintiff.

I have concluded that that the plaintiff has established that he is entitled to judicial review remedies quashing the Medical Panel’s determination and requiring the redetermination of the medical question. I have concluded that the Medical Panel did not comply with the requirements of s 28LL(3) of the Wrongs Act 1958 because it disregarded an impairment from an unrelated injury or cause without first making a decision based on the evidence whether that impairment was playing a part in the plaintiff’s current impairment at the time of its determination.

The plaintiff’s negligence proceeding

Mr Larman commenced a proceeding in this Court on 9 March 2022 claiming damages for alleged negligence by the second, third and fourth defendants, being Alfred Health and general practitioners, Dr Sven Strecker and Dr Vincent Cornelisse. I will often refer to those defendants collectively as ‘the defendants’. He alleged that each of them failed to undertake steps in the period February 2013 to early 2015 regarding his rectal symptoms.

The plaintiff’s statement of claim pleads that on 5 February 2013 the first defendant sent a discharge summary to the second defendant at the Prahran Market Clinic which stated, inter alia, that the plaintiff’s diagnoses included a likely perianal fistula. A fistula is an unnatural communication between an organ and the surface of the body, or between one organ and another. An anal fistula is an open channel from the anus or rectum to the skin near the anus[1] from which discharge may occur.
[1]Plaintiff’s submissions, dated 15 April 2024, p 3, footnote 10, citing Butterworths Medical Dictionary (2^nd ed, 1978) ‘fistula’.

The plaintiff pleaded that on 12 March 2015 he consulted with the fourth defendant, and reported ongoing coccyx pain and that he had developed a purulent anal discharge. The fourth defendant identified on digital rectal examination a peri-anal fistula with some hardening in the anal canal and referred Mr Larman for an urgent CT scan of the pelvis and to the colorectal surgery team of the Alfred Hospital, which is owned and operated by Alfred Health.

On 15 April 2015, the plaintiff consulted with a colorectal surgeon of Alfred Health, who identified on examination a small 1cm area draining pus in the superior right area of the natal cleft, along with some irregularity of the posterior anal canal and presacral swelling on the right. The natal cleft is the area where the top of the buttocks meet.[2]
[2]Transcript of Proceedings James Larman v Drs Susanne Homolka & Peter Burke constituting the Medical Panel pursuant to the Wrongs Act 1958 (Vic) (Supreme Court of Victoria, S ECI 2023 03282, Ginnane J, 12 June 2024) (“T”), 5.

On 30 April 2015, the plaintiff underwent an MRI scan of his rectum and anus at the Alfred Hospital. It identified a posterior anal mass with two fistulas, one located in the natal cleft and one inside the anal canal.

On 21 May 2015, the plaintiff underwent an examination under anaesthetic, a biopsy and insertion of a seton drain into the natal cleft fistula, which was performed at the Alfred Hospital. A seton drain is inserted by operation to collect and drain discharge from a fistula.[3] He was diagnosed with two fistulas, being a natal cleft fistula and a submucosal fistula and a moderately differentiated squamous cell carcinoma of the anus, being anal cancer. Submucosal refers to the layer of tissue beneath the mucosa or mucous membrane.
[3]Ibid.

The plaintiff alleged that as a result of the negligence of the defendants he suffered injury, loss and damage. He contends that as a result of the delay in the diagnosis of cancer, he suffered progression of the anal cancer which caused or contributed to the development and worsening of two anal fistulas, the most significant of which was located in the right natal cleft area, for which he requires ongoing treatment with a permanent seton drain. He also alleges that he has developed faecal incontinence and the persistence of, and ongoing discharge from, the natal cleft fistula which were related to higher doses of radiotherapy required to treat the late diagnosed cancer.

The second, third and fourth defendants filed defences denying the allegations of negligence made against them. They pleaded that the plaintiff had not established that he had suffered a ‘significant injury’ as defined in s 28LF of the Wrongs Act 1958 (‘the Act’) and he was therefore not entitled to recover damages for non-economic loss.

On or about 11 October 2022, the plaintiff served upon the second, third and fourth defendants the prescribed information and a certificate of assessment in accordance with s 28LT of the Act. The certificate of assessment was completed by Associate Professor Anthony Buzzard, general surgeon, and certified that the degree of impairment resulting to Mr Larman satisfied the threshold level as required by the American Medical Association Guide, per s 28LH(1)(a)(i) of the Wrongs Act.

Statutory provisions

Section 28LE of the Act precludes the recovery of damages for non-economic loss in respect of an injury to a person caused by the fault of another person, unless the person injured ‘has suffered significant injury’. The term ‘significant injury’ is defined in s 28LF of the Act.

Upon the referral to the Panel of a question pursuant to Division 5 of Part VBA of the Act, the Panel’s statutory task is to determine, if possible, the claimant’s degree of ‘impairment’ and state whether that impairment is above or below the ‘threshold level’.

The ‘threshold level’ is defined in s 28LB of the Act and for present purposes is more than five per cent.

The Panel, in making its assessment of a claimant’s degree of ‘impairment’ and stating whether that impairment was above or below the ‘threshold level’, must comply with s 28LL(3) of the Act requires that ‘impairments from unrelated injuries or causes … be disregarded in making an assessment’.

The assessment of a claimant’s degree of impairment was to be made in accordance with the American Medical Association Guides to the Evaluation of Permanent Impairment (Fourth Edition) (‘the AMA Guides’). ‘Impairment’ under the AMA Guides is defined to mean ‘the loss, loss of use, or derangement of any body part, system or function’.[4] The AMA Guides also state that impairments:

… are defined as conditions that interfere with an individual’s “activities of daily living”, some of which are listed in the Glossary (p. 315). Activities of daily living include, but are not limited to, self-care and personal hygiene; eating and preparing food; communication, speaking, and writing; maintaining one’s posture, standing and sitting; caring for the home and personal finances; walking, travelling and moving about; recreational and social activities; and work activities.[5]
[4]Guides to the Evaluation of Permanent Impairment (American Medical Association, 4^th ed, 1993), 315.
[5]Ibid 1.

The parties’ submissions to the Panel

The plaintiff’s submissions to the Panel of 5 May 2023 included a summary of his claims in his Supreme Court proceeding which I have described above. He disputed the defendants’ contention in their previously filed submissions that his history of perianal abscesses and potential fistula provided a basis for the Panel to determine that the current perianal fistula requiring seton drainage was a pre-existing and therefore unrelated injury. He contended that the main fistula which he had developed was the natal cleft fistula, which was not present in 2013, had likely developed in 2014 and was likely created by the cancer. There was no evidence on which the Panel could be satisfied that the natal cleft fistula which was diagnosed in March 2015 was pre-existing, and therefore, an unrelated injury. Prior to the alleged negligence he did not have the natal cleft fistula requiring seton drainage and incontinence. Disregarding only any unrelated impairments that are established by the evidence, he had an impairment from the claimed injury that exceeded the threshold.

The second defendant, Alfred Health, in submissions of 6 December 2022, provided before the plaintiff’s submissions, contended that his injuries did not satisfy the requisite threshold once his demonstrated unrelated physical impairment was disregarded in accordance with s 28LL(3). It contended that he had a long-standing fistula and that the existence of a fistula with a long-term seton was an unavoidable consequence of both the long-standing fistula and the cancer which arose subsequently. The chemo-radiation required to treat his anal cancer led to the persistence of the fistula, which would have been the case even if he had been diagnosed with cancer in January 2013 and had undergone chemo-therapy radiation at that stage rather than in May 2015.

The Medical Panel’s reasons

The Panel made the following diagnosis of the plaintiff:

The Panel concluded that the claimant is suffering from anal dysfunction with mild perianal inflammation following anorectal carcinoma treated with chemoradiotherapy and from a chronic anal fistula treated with a seton drain.[6]

[6]Medical Panel’s Reasons (‘Reasons’) p 9, Court Book (‘CB’) 67.

The Panel noted from the referral documents that the physical injury to the plaintiff alleged in his claim was described as ‘progression and growth of anal cancer, natal cleft fistula, submucosal fistula, coccyx pain, requirement for high dosage and treatment of radiotherapy, requirement for seton drain, faecal incontinence, likely future need for permanent colostomy’[7] which he alleged that he suffered on 29 January 2013 (‘the incident’) at the Alfred Hospital and in the period from February 2013 to 12 March 2015 (‘the incident period’) at the Prahran Market Clinic as a result of the allegations made in his statement of claim.
[7]Ibid p 2, CB 60.

The Panel noted that in his statement of claim, the plaintiff alleged that on 29 January 2013 he presented to the Alfred Hospital with a perianal abscess; that between February 2013 and March 2015 he attended the Prahran Market Clinic and that he was diagnosed with a moderately differentiated squamous cell carcinoma of the anus and with what was described as ‘two fistulae, being the natal cleft fistula and a submucosal fistula’.[8]
[8]Ibid.

The Panel noted and accepted that no surgical or other invasive treatment was planned for the foreseeable future, and that due to the nature and duration of the plaintiff’s symptoms, his medical condition had stabilised for the purpose of an impairment assessment.

The Panel considered the plaintiff’s history in conjunction with the documented medical evidence in the referral material. It recorded that he provided a history of recurrent perianal abscess and recurrent anal fistula requiring surgical treatment prior to the incident and incident period. The Panel noted that his history was supported by documented evidence, albeit that his recall of events was not always entirely chronologically accurate. The Panel also noted that the plaintiff reported his anal fistula and that it was documented to have been intermittently symptomatic, with anal pain and a discharge of purulent and/or faecal material, since it was first diagnosed in 1998. That diagnosis occurred alongside a perianal abscess for which he had sought treatment. The Panel stated that the plaintiff sought further surgical treatment, and his anal fistula was again noted in 2007. The Panel noted that the fistula was treated with a seton drain prior to the confirmation of his anorectal carcinoma diagnosis and his commencement of chemoradiotherapy.[9]
[9]Ibid p 10, CB 68.

The Panel noted the Court of Appeal judgment in Lingenberg v Gallichio & Ors,[10] which stated that ‘the statutory imperative to disregard the degree of impairment due to underlying injury requires a Medical Panel to ‘do its best to evaluate the extent to which impairment from the unrelated injury or cause is playing a part in the (claimant’s) current impairment.’[11] The Panel stated that in accordance with that judgment, and based on the plaintiff’s history in conjunction with the Panel’s analysis of the documented, objective medical evidence in relation to his symptoms pre and post the incident and incident period, it assessed a pre-existing whole person impairment resulting from the claimant’s pre-existing anal fistula.[12]
[10][2013] VSCA 143.
[11]Ibid [29].
[12]Reasons p 10, CB 68.

After disregarding the ‘extensive’ pre-existing impairment, unrelated to the incident and incident period, the Panel concluded that the degree of whole person impairment resulting from the physical injury to the plaintiff alleged in the claim is permanent but was not more than five per cent.[13]
[13]Ibid.

Judicial review grounds

The plaintiff seeks judicial review of the Panel’s determination on three grounds:

1.The Medical Panel denied the plaintiff procedural fairness or otherwise fell into jurisdictional error by failing to consider his clearly articulated case which included that his natal cleft fistula developed in 2014, and that it was not the same fistula that was present and diagnosed in early 2013, and failed to ask itself the right question.

2.The Medical Panel overlooked or misunderstood or misconstrued relevant material before it or otherwise made a factual error constituting a jurisdictional error in concluding that he had a recurrent anal fistula that had been present and intermittently symptomatic since 1998 and that it was that fistula which was ultimately treated with a seton drain, such that there was pre-existing whole person impairment from the pre-existing anal fistula which should be disregarded pursuant to s 28LL(3) of the Wrongs Act 1958 (Vic).

Particulars
The relevant factual material that was overlooked or misunderstood or misconstrued by the Panel comprises:
a)   material showing that the fistula diagnosed and treated in early 2013 was a different fistula to the natal cleft fistula which was identified in April 2015, including contemporaneous diagrams showing that the 2013 fistula was located in the left scrotal /anal area anterior to the anus whereas the 2015 natal cleft fistula was located in the right natal cleft area posterior to the anus;
b)     a record that the plaintiff was found to be suffering from perianal cellulitis in December 2017, which the defendants’ submissions to the Panel and the Panel erroneously relied upon as having been made in December 2007;
c)   a referral letter to Dr Farmer, which the Panel erroneously relied upon as having been written in 2007.

3.The Medical Panel made a material factual error or finding that was not open in concluding that there was information in the referral material that he underwent drainage of a recurrent perianal abscess ‘again in December 2007 when the presence of an anal fistula was again noted, and he was also found to be suffering from perianal cellulitis’(reasons page 8 of 11).

Medical evidence

Mr Larman relied on the report of Associate Professor Buzzard of 17 November 2021, which was described as an Independent Impairment Assessment. He conducted a video link interview with Mr Larman and had access to approximately 3,000 pages of medical records, the majority of which consisted of test results.

Associate Professor Buzzard recorded that Mr Larman’s complaint related to loss of bowel control and continence problems. He considered those problems could be described as moderate and required continual treatment. Although he had not carried out an anorectal examination, he thought it reasonable to accept that Mr Larman did have signs of organic anal disease which caused the incontinence. He put Mr Larman at the lower end of the whole person impairment scale ‘say 12% whole person impairment’.[14]
[14]CB 149.

Mr Larman also relied on a report of Professor Stephen Fox, who is a consultant pathologist and a specialist in cancer pathology. He estimated the probable size, stage and location of Mr Larman’s cancer as at particular dates. He noted that the medical records showed that from the late 1990s, Mr Larman had perianal issues with abscesses and fistula formation.[15]
[15]CB 1914.

Mr Larman also relied on a report of Associate Professor Susan Pendlebury, an oncologist, dated 18 February 2021. She based her report on his medical records and the assumptions of cancer size she was asked to make. She neither interviewed nor examined Mr Larman. Her report summarised significant events in Mr Larman’s medical history, most of which I have previously mentioned.

Associate Professor Pendlebury expressed opinions about the treatment that Mr Larman would have been offered if his anal cancer had been identified and diagnosed at February 2013 and later dates. She stated that as at June 2013, the anal fistula was small, so was unlikely to be a lasting problem and the main fistula with the tract opening near the natal cleft had not developed, so it would not have been the problem it became after the radiotherapy. A seton drain was not required. She considered that it was likely that the anal cancer was creating a fistula as it grew between November 2013 and May 2014. Without the fistula opening to the exterior, the leakage from which had been Mr Larman’s concern since his cancer treatment, the risk of an ongoing fistula and the need for a seton drain were low. The natal cleft fistula began in 2015 and it was not until the fistula reopened the natal cleft in January 2017 that Mr Larman’s incontinence and discharge recommenced.

Associate Professor Pendlebury expressed the opinion that had Mr Larman’s cancer been diagnosed in February 2013:

The troublesome anal fistula emerging near the natal cleft would have been avoided. The smaller fistula possibly present would likely have resolved. So ongoing fistulae avoided.[16]

[16]Associate Professor Susan Pendlebury’s Report, 18 February 2021) (‘Pendlebury report’), p 6, CB 1904.

Answering the same question as at November 2013, Associate Professor Pendlebury stated, ‘The significant fistula opening at the natal cleft had not emerged at this time, so the ongoing problems regarding it that he now experiences would likely have been avoided’.[17] In respect of the same question as at March 2015 she stated that, ‘The anal fistula was definitely present now with discharge now present. And fistula was likely to remain’.[18] This was a reference to the natal cleft fistula as she stated that:

In this case the risk of that increased after February 2015 when the fistula opened near the natal cleft. In managing malignancy, once a fistulous tract has opened with connections at both ends (bowel and exterior), it id very common for the tract to remain an ongoing problem long after the malignancy has gone. Diagnosis at any time prior to the opening at the natal cleft in early 2015 would likely have avoided that problem.[19]

[17]Ibid, p 9 CB 1907.

[18]Ibid, p 11, CB 1909.

[19]Ibid.

The defendants relied on a report of Mr James Keck of 8 June 2022, which was based on a summary of Mr Larman’s claim and his medical records. Mr Keck is a colorectal surgeon, the Clinical Director of Colorectal Surgery at Eastern Health and Head of Colorectal Surgery at St Vincent’s Health, Melbourne. He stated that, ‘The plaintiff had an anal fistula present between the time of his initial abscess in 1998 and certainly up until the time of his diagnosis with anal cancer, although this fistula had been quite dormant at different times and only caused symptoms intermittently’.[20] Mr Keck appears to have diagnosed the plaintiff as having one fistula.
[20]Report of Mr James Keck of 8 June 2022, CB 154.

Mr Keck stated that, based on the contents of the general practitioners’ referrals of Mr Larman to Mr K Farmer a surgeon, Mr Larman’s fistula was present well before his presentation to the Alfred Hospital in 2013, but it was quiescent and his symptoms were intermittent warranting referrals to Mr Farmer in 2001 and in 2007.[21] Mr Larman had no clinical signs to suggest cancer until he was examined by his general practitioner in March 2015.[22]
[21]Ibid CB 157.
[22]Ibid CB 158.

Mr Keck noted that when Mr Larman’s surgery occurred, the cancer was associated with a fistula which was treated with a draining seton. He noted that, thereafter, he experienced symptoms related to his fistula which never healed with the seton drain being inserted, removed and then inserted again.

Mr Keck had no doubt that Mr Larman had a fistula, which was present in January 2013 and which was still present when his cancer was diagnosed in 2015. He thought that the chemo-radiation has led to a persistence in the fistula which, in turn, has caused [him] significant morbidity [sic]...’.[23]
[23]Ibid CB 159.

Mr Keck concluded his report by stating:

The Plaintiff has had ongoing symptoms related to an anal fistula which was probably made worse by the radiotherapy but which was certainly present for many years prior to diagnosis. The long-standing fistula was invariably going to cause some degree of ongoing symptoms after the patient had been given radiotherapy and there was really no opportunity to try and heal the fistula prior to treating the anal cancer. Therefore, the existence of a fistula with a long-term seton is an unavoidable consequence of both the long-standing fistula itself and the cancer which arose subsequently. Fortunately, the plaintiff has experienced an excellent outcome from the treatment of his cancer.[24]

[24]Ibid CB 161.

The defendants also relied on a report of Dr Richard Brouwer, who is a specialist colorectal surgeon, dated 18 December 2022.[25] His report concerned causation in connection with Mr Larman’s claim and was based on Mr Larman’s statement of claim, the defences, his clinical records and the defendants’ solicitors summary of the claim. Dr Brouwer recorded that the plaintiff had a long history of ‘anal fistula/abscess’ from at least 1998.[26] From what he could tell from the medical notes, the fistula had been reasonably dormant and not causing the plaintiff much problems and that it was only in January 2015, when he was admitted to the Alfred Hospital, that the referring doctor also noticed that there was a perianal fistula and abscess. Dr Brouwer considered that anal cancer was present in 2015 when Mr Larman was admitted to the Alfred Hospital. He believed that the anal fistula was very long standing and had only been intermittently symptomatic. He believed that Mr Larman’s cancer arose in the middle of 2014 and that he had had a very good clinical outcome from his cancer treatment.
[25]CB 1841.
[26]Ibid.

The plaintiff’s submissions on grounds one and two

Mr Larman’s submission in support of his first ground was that the Medical Panel erred in considering whether he had a pre-existing impairment at the time it made its determination. Determining whether there was any pre-existing impairment to be disregarded pursuant to s 28LL(3) of the Wrongs Act was an essential part of the proper performance of the Medical Panel’s statutory functions.

Mr Larman argued, particularly in oral submissions, that the Panel reached the conclusion that there was an impairment from an unrelated injury or cause to be disregarded under s 28LL(3) based on its finding that his natal cleft fistula was pre-existing, whereas there was no evidence that it was. Mr Larman contended that, in finding that his natal cleft fistula was pre-existing and productive of extensive pre-existing permanent impairment, the Panel misconstrued and overlooked relevant material, failed to understand or address his case and failed to ask itself the right question.

Mr Larman contended that it was plain from the Panel’s reasons that ‘the anal fistula’ or ’the fistula’ which it disregarded as a pre-existing impairment, and as productive of ‘extensive’ pre-existing impairment, was the natal cleft fistula, which was the only fistula treated with a seton drain. There was no evidence that he had had a seton drain inserted into any other anal fistula. The earlier fistulas were at different locations without seton drains and for long periods had no symptoms. The Panel did not conduct any anal examination, so it is likely that the fistula that it found and disregarded was the natal cleft fistula.

Mr Larman contended that the evidence showed that the right natal cleft fistula that required insertion of the seton drain was not present in 2013. It likely developed in 2014 as a result of his cancer, was worsened by the cancer’s development or the increased doses of radiation therapy needed as a result of the delayed diagnosis of the cancer. Had the cancer been diagnosed and treated in 2013, the fistula would have been smaller and not the lasting problem which required a seton. The Panel did not mention, or engage with these arguments.

Mr Larman also argued that there was no evidence that the anal fistula the Panel mentioned as dating from 1998 still existed in 2023 when the Panel made its determination. The natal cleft fistula was not first documented or surgically treated in 1998. The suspected fistula identified in 2013 was not recorded in the medical records to be ongoing from 2013 until the date of the Panel’s examination in 2023. The 2013 fistula was located in the left scrotal anal area anterior to the anus. Mr Larman had long periods without symptoms and without a diagnosis of an ongoing fistula. The Panel’s statement that in December 2007, Mr Larman was noted to have a anal fistula present and to be suffering from perianal cellulitis was incorrect as those events occurred in December 2017.

The Panel erroneously disregarded the impairment resulting from the potentially compensable injury, being the natal cleft fistula, and not from an unrelated injury or cause. The Panel therefore made the same error as Mr Keck, who mistakenly thought that Mr Larman’s natal cleft fistula had been present and intermittently symptomatic since 1998. This was a key error in the Panel’s reasons. The Panel acted on the basis that its findings about when ‘the fistula’ had been treated with a seton drain meant that there was a pre-existing impairment to be disregarded. In so acting, the Panel disregarded an impairment related to Mr Larman’s potentially compensable injury, which was the natal cleft fistula. The Panel therefore failed to consider Mr Larman’s case properly, and failed to ask itself the right question in determining whether he had an unrelated impairment.

Mr Larman also argued, it seemed in the alternative, that, if the Panel disregarded an submucosal anal fistula as an unrelated impairment, it did so without making a finding or diagnosis that that anal fistula was continuing when it made its determination in May 2023. The Panel therefore did not diagnose what it excluded in 2023. The Panel had no evidence of a second persisting fistula, ie evidence of a fistula additional to the natal cleft fistula, which was productive of ongoing impairment. In order for a pre-existing impairment to attract the operation of s 28LL(3), it must still be playing a part in the claimant’s current impairment.

The Panel did not diagnose the plaintiff as suffering from an ongoing submucosal fistula, or anal fistula, or find that any existing submucosal fistula was productive of his current symptoms or impairment as at the date of its determination.

The defendants’ submissions on grounds one and two

The defendants submitted that the Court should not conduct a detailed factual analysis of the medical evidence before the Panel. This would risk usurping the expertise of the Panel and undertaking an impermissible merits review.

The Panel’s diagnosis should be considered holistically. It assessed the two fistulas on which Mr Larman relied in the referral materials and in his statement of claim. The Panel understood that Mr Larman suffered from two fistulas and it assessed the submucosal or anal fistula as a pre-existing unrelated impairment. While the Panel’s diagnosis only referred to a chronic anal fistula treated with the seton drain, the Panel assessed the two fistulas, as the referral requested it to do. It disregarded the impairment from the pre-existing anal submucosal fistula, which Mr Larman alleged in his statement of claim was continuing.

The Panel correctly directed itself and reached its conclusion on the basis that Mr Larman had symptomatic and pre-existing anal abscesses and fistulas pre-dating the alleged negligence which it was required to disregard.

The Panel found two fistulas and disregarded the anal fistula that commenced in 1998. The Panel used its expertise to reach the conclusion that the fistula was continuing to cause Mr Larman impairment, at the date of its examination, with the leakage of purulent material. The Panel did not find that the natal cleft fistula was a pre-existing impairment. Rather, it found that the submucosal anal fistula was the pre-existing fistula. There was ample evidence to support that finding. A seton drain had been inserted for that fistula prior to his cancer treatment in 2015.

The Panel understood that the submucosal anal fistula was pre-existing and that the natal cleft fistula with the seton drain, which had arisen as a result of the incident, was separate and was not a pre-existing injury.

At the commencement of its reasons, the Panel correctly described the alleged injury, and twice identified as separate, the natal cleft fistula and the submucosal fistula. It was open to the Panel to conclude that the submucosal anal fistula was pre-existing and productive of unrelated injuries or causes that it was required to disregard. Mr Larman’s statement of claim alleged that he suffered from two fistulas as did Associate Professor Pendlebury’s report on which he relied. The Panel considered the applicable case law and identified the correct test.

Mr Larman told the Panel that he attended the Alfred Hospital for treatment of a recurrent perianal abscess and anal fistula on a number of occasions over the years. He also informed it that in 2004 he was diagnosed with a fistula, but it ‘was packed and healed up’. However, he also told the Panel that, over the years, the fistula recurred and eventually was treated with a seton drain, although he could not remember when that was done. He also told the Panel that he suffered intermittent rectal pain in association with the fistula between 2004 and 2015. In January 2013, on a medical examination at the Prahran Market Clinic, he was noted to have a left perianal 1cm discharging mass attached to the skin and it was noted that he had a discharging anal fistula. The radiology MRI on 30 April 2015 noted that he had two fistulas, one located in the natal cleft and one inside the anal canal.

The Panel was entitled to conclude that the earlier fistula had been drained with a seton drain, which must have been a drain into the pre-existing fistula before the seton drain inserted into the natal cleft on 21 May 2015. There was also evidence that the perianal abscess had been drained in 1998. The Panel was also entitled to accept the history that Mr Larman recounted even if parts of it were unreliable. The Panel also noted the general practitioners’ referral letters to Mr K Farmer, a surgeon, stating that, since Mr Larman’s perianal abscess was drained in October 1998, ‘he has had almost continuous leakage of purulent material PR’ (per rectum).

Analysis of ground one

The plaintiff’s first ground alleges that the Panel denied him procedural fairness or otherwise fell into jurisdictional error by failing to consider ‘his clearly articulated case’ that his natal cleft fistula developed in 2014, and that it was not the same fistula that was present and diagnosed in early 2013, and thereby failed to ask itself the right question.

The Panel was requested to consider the plaintiff’s claim which listed his alleged physical injuries as including: progression and growth of anal cancer; natal cleft fistula; submucosal fistula; coccyx pain; requirement for higher dosage and treatment of radiation; requirement for seton drain; faecal incontinence; and likely future need for permanent colostomy. Mr Larman’s statement of claim, his claim referred to the Panel and his submissions to the Panel listed both a natal cleft fistula and an anal fistula among the injuries that he had suffered a result of the defendants’ alleged negligence.

The plaintiff bears the onus of establishing that the Panel’s determination was affected by jurisdictional error, or contained an error of law on the face of the record.[27] A Panel’s decision which fails to consider material aspects of a claimant’s case, or does not correctly apply a relevant statutory provision, is made in jurisdictional error.
[27]MZAPC v Minister for Immigration and Border Protection (2021) 273 CLR 506 at [39]; LPDT v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2024) 98 ALJR 610 at [13] (‘LPDT’).

The plaintiff’s grounds in essence contend that the Panel misunderstood or failed to consider his case and therefore failed to perform its statutory function or failed to observe procedural fairness in considering the medical question referred to it. The plaintiff did not rely on no evidence or no adequate reasons grounds.

I do not accept that Mr Larman’s attack on the Panel’s determination is an attempt to re-agitate the factual basis of the Panel’s impairment assessment. His complaint is that the Panel did not apply the provisions of the Wrongs Act, especially s 28LL(3), to the evidence before the Panel. I also do not consider that his arguments involve merits review or, would require the Panel to explain why it did not give a different diagnosis nor to explain the level of impairment that it adopted.

The function of a Medical Panel was described by the High Court in Wingfoot Australia Partners Pty Ltd v Kocak:[28]

The function of a Medical Panel is to form and to give its own opinion on the medical question referred for its opinion. In performing that function, the Medical Panel is doubtless obliged to observe procedural fairness, so as to give an opportunity for parties to the underlying question or matter who will be affected by the opinion to supply the Medical Panel with material which may be relevant to the formation of the opinion and to make submissions to the Medical Panel on the basis of that material. The material supplied may include the opinions of other medical practitioners, and submissions to the Medical Panel may seek to persuade the Medical Panel to adopt reasoning or conclusions expressed in those opinions. The Medical Panel may choose in a particular case to place weight on a medical opinion supplied to it in forming and giving its own opinion. It goes too far, however, to conceive of the function of the Panel as being either to decide a dispute or to make up its mind by reference to competing contentions or competing medical opinions. The function of a Medical Panel is neither arbitral nor adjudicative: it is neither to choose between competing arguments, nor to opine on the correctness of other opinions on that medical question. The function is in every case to form and to give its own opinion on the medical question referred to it by applying its own medical experience and its own medical expertise.

[28](2013) 252 CLR 480, [47] (citations omitted).

In Victorian Workcover Authority v Jamali,[29] the Court of Appeal accepted the following principles as applying to the determination of an application for judicial review of a Medical Panel’s determination:
[29][2023] VSCA 240 [62].

(a) a court must ensure that it does not fall into the trap of engaging in a merits review;
(b) the court should be extremely careful when analysing the reasons of an expert Medical Panel charged with answering medical questions;
(c) in determining whether a decision-maker has had regard to a mandatory consideration, failure to especially refer to the matter does not necessarily lead to the inference that it was not considered;
(d) determining whether a matter has been taken into account is a matter of fact and not of surmise;
(e) the reasons provided by a Medical Panel should not be construed minutely and finely with an eye keenly attuned to the perception of error; and
(f) a Medical Panel is under no obligation to explain why it did not reach an opinion it did not form.

In my opinion, the plaintiff has not established ground one. The Panel did not fail to consider his case or deny him procedural fairness.

I do not consider that the Panel’s reasons suggest that it misunderstood which fistula was which. Rather, they demonstrate that the Panel understood that Mr Larman had two fistulas, the natal cleft fistula that developed in 2015 and the anal or submucosal fistula which it found developed at an early time. It noted that his statement of claim alleged that he suffered from two fistulas. It noted that the MRI of 30 April 2015 revealed ‘an anal mass, two prominent ischio-anal lymph nodes and two fistulas, one located in the natal cleft and one inside the anal canal’.[30] In its physical examination of Mr Larman, it noted ‘the presence of a seton drain in a natal cleft fistula’.[31] But in the Panel’s ‘Impairment Assessment’, it considered the other fistula, the anal or submucosal fistula.
[30]Reasons, p 5, CB 63.
[31]Reasons p 8, CB 66.

The Panel did not confuse the two fistulas, and its reasons read as a whole, make it clear that it recognised the differences between them. In its consideration of Mr Larman’s pre-existing impairment, the Panel considered a recurrent anal fistula which it found was first diagnosed in 1998 and in which a seton drain had previously been inserted. The history of that anal fistula recorded by the Panel makes it clear that it was not discussing the natal cleft fistula, which was first diagnosed in April 2015. As Mr Larman put it, during the hearing of this proceeding, the natal cleft fistula was his potentially compensable injury,[32] or at least his substantial compensable injury.
[32]T 10, 17.

The Panel’s diagnosed that Mr Larman suffered from ‘a chronic anal fistula treated with a seton drain’. That diagnosis related to the natal cleft fistula which developed in 2015 and not to the anal submucosal fistula.

Ground one is not established.

Analysis of ground two

Mr Larman’s second ground contends that the Panel overlooked, misunderstood or misconstrued relevant factual material, or otherwise made a factual error constituting a jurisdictional error in concluding that he had a recurrent anal fistula that had been present and intermittently symptomatic since 1998. He contends that it was that fistula which was ultimately treated with a seton drain, so that there was pre-existing whole person impairment from the pre-existing anal fistula which should be disregarded pursuant to s 28LL(3) of the Wrongs Act.

As argued by Mr Larman at the hearing, ground two included the contention that insofar as the Panel did identify the anal fistula as the pre-existing impairment, it did not make a diagnosis of the extent of that impairment in its determination of March 2023, or determine that it was an existing unrelated permanent impairment. It did not carry out a digital rectal examination of his anal fistula stating that it ‘was not considered to be necessary for the Panel to complete its assessment and answer the medical question’.

Before a Medical Panel may disregard an impairment from an unrelated injury or cause, it must have an evidentiary basis on which it can be positively satisfied of the existence of that impairment.[33] In addition, the impairment from unrelated injuries or causes must be playing a part in the claimant’s current impairment at the time of the Panel’s determination.[34]
[33]Chua v Lowthian [2011] VSC 468 [135].
[34]Alcoa Holdings Ltd v Lowthian [2011] VSC 245 [73] (J Forrest J) (‘Alcoa Holdings’); applied by Niall JA in City of Melbourne v Neppessen [2019] VSC 84 [123] (‘Neppessen’).

Thus in Alcoa Holdings Ltd v Lowthian,[35] to which the Panel referred, J Forrest J stated:

In engaging in its statutory task the Panel must do the best it can to evaluate the extent to which impairment from the unrelated injury or cause is playing a part in the worker’s current impairment.[36]
…
The Panel did not have a discretion to ignore the effect of the pre-existing impairment. It was required to take into account its contribution to [the worker’s] current impairment. There was sufficient evidence available to it to make this assessment.[37]

[35]Alcoa Holdings (n 34).

[36]Ibid [73].

[37]Ibid [83].

His Honour noted that the Panel using its collective expertise and knowledge could simply attribute an estimate of the compensable injury related impairment after taking into account and disregarding the non-related contribution to the impairment. He stated that the Panel’s reasons should however reveal how it had approached the task.[38]
[38]Ibid [75].

In Chua v Lowthian,[39] to which the Panel also referred, Osborn J described the requirements of s 28LL(3), as follows:

Fourthly, any assessment of pre-existing impairment must be evidence based. It cannot simply be speculative. The Panel must have an evidentiary basis on which it can be positively satisfied of a pre-existing impairment which it then disregards. The Panel is not bound by rules or practices as to evidence but it must act on the basis of evidence of some sort.[40]

[39]Chua v Lowthian (n 33).

[40]Ibid [135].

Niall JA in City of Melbourne v Neppessen[41] also discussed a panel’s duty under s 28LL(3) in dealing with an impairment from unrelated injuries or causes. He stated that the panel must identify any impairment arising from an unrelated injury or cause, whether pre-existing or subsequent, and ensure that its estimate of impairment disregarded any other impairment ie by quarantining that part of it which derived from an unrelated injury or cause.[42] The panel’s task is to do its best to evaluate the extent to which such an impairment is playing a part in the person’s current impairment. The panel does not have to speculate, but has to disregard any impairment, either pre-existing or post-dating the injury, which is established by evidence to have resulted from a cause other than the relevant injury. The assessment of a pre-existing or subsequent impairment requires some evidentiary basis.[43] The panel is prohibited from specifying the precise degree of impairment and is not obliged to determine the level of impairment caused by non-related events in accordance with the Guides, but rather is entitled to make an assessment using its professional skill and judgment.[44] No mathematical precision is required. The panel could determine whether it had sufficient information in order to make the required assessment of impairment, but is under no obligation to undertake further tests or obtain information from treating practitioners.[45]
[41]Neppessen (n 34) [122]-[138].
[42]Ibid [128].
[43]Ibid [125].
[44]Ibid [134].
[45]Ibid [153].

In this case, the Panel’s consideration of the anal fistula as an impairment from an unrelated injury or cause appears under the heading ‘Impairment Assessment’ in its reasons. It described that fistula as a recurrent anal fistula and noted that:

the claimant’s anal fistula is both reported by the claimant and documented to have been intermittently symptomatic, with anal pain and a discharge of purulent and/or faecal material, since it was first diagnosed in 1998, and the Panel also noted that the fistula was treated with a seton drain prior to the confirmation of his anorectal carcinoma diagnosis and commencement [of] chemoradiotherapy.[46]

[46]Reasons, p 10, CB 68.

The Panel referred to Mr Larman’s extensive pre-existing impairment unrelated to the incident and the incident period. It referred to evidence that supported the conclusion that he had a recurrent anal fistula for periods up to 2015. The Panel described him in 1998 as requiring surgical treatment for a perianal abscess and an associated anal fistula.

Professor Fox concluded that, from the late 1990s, Mr Larman had issues with abscess and fistula formation.[47] Dr Brouwer believed ‘the anal fistula was very long standing and had only been intermittently symptomatic’.[48] Mr Keck considered that Mr Larman had an anal fistula for many years prior to January 2013.[49]
[47]CB 1914.
[48]Ibid 1843.
[49]Ibid 157.

There was evidence to support the Panel’s conclusion that Mr Larman suffered from discharge from his anal fistula intermittently before developing the natal cleft fistula in 2015. He recalled attending the Alfred Hospital for treatment of a recurrent perianal abscess and an anal fistula on a number of occasions over the years.[50] He told the Panel that in 2004 he was diagnosed with a fistula,[51] but that it was ‘packed and healed up’.[52] However, he also said that:

over the subsequent years the fistula recurred, and eventually was treated with a seton drain, but he said that he could not remember when this was done. He told the Panel, however, that the seton drain had been in situ for some time prior to the diagnosis of his cancer in May 2015, and he repeated this information several times during the consultation.
He told the Panel that the seton drain was replaced after the completion of his radiotherapy treatment.[53]

[50]Reasons, p 8, CB 66.

[51]Ibid, p 3, CB 61.

[52]Ibid, p 4, CB 62.

[53]Ibid.

On 29 January 2013, Mr Larman presented at the Prahran Market Clinic with a discharging anal fistula.[54] On 12 March 2015, he presented at the same clinic and it was recorded that he had developed anal discharge (purulent).[55]
[54]Ibid.
[55]Ibid, p 5, CB 63.

The Panel was entitled to accept Mr Larman’s statement that he had a seton drain in situ for some time prior to his diagnosis with cancer in May 2015.[56] Although the Panel found that his recollection of events did not quite correlate with, and was not supported by the documented medical evidence, it did not state that it had rejected all his evidence.
[56]Ibid, p 10, CB 68.

Because there was evidence of two fistulas, the Panel’s task was to disregard in its determination an impairment from unrelated injuries or causes, which was the anal or submucosal fistula, provided that impairment was playing a part in Mr Larman’s current impairment, which was the natal cleft fistula.

Mr Larman told the Panel of his intermittent symptoms associated with the anal fistula:

he suffered intermittent rectal pain in association with the fistula between 2004 and 2015, but he said that the pain was ‘different from the cancer pain, more like a toothache’ rather than the severe, sharp pain which he experienced between 2003 and 2015 and which he attributed to his anal malignancy. He told the Panel, however, that he did not suffer from faecal incontinence, nor experienced any discharge from the fistula, prior to the chemoradiotherapy treatment.[57]

[57]Ibid p 3, CB 61.

The medical records provided to the Panel concerning Mr Larman’s fistulas included those of Mr Peter Carne, a visiting colorectal surgeon at the Alfred Hospital, who performed biopsies on Mr Larman which led to his cancer diagnosis, and who treated him between at least 2015 and 2021. His records provide information of the impairment caused by Mr Larman’s fistulas during that period. I have described some of that information in summarising the pleadings in Mr Larman’s statement of claim, but I will repeat part of it to summarise the information that Mr Carne’s records provided.

On 15 April 2015, Mr Carne noted that Mr Larman informed him that he had had perianal symptoms for the last 18 months, with the initial symptom being of pain and that:

He subsequently developed some swelling over the last six months and in the last two months, what he describes as a watery discharge both from the natal cleft region and also the anus.[58]

[58]CB 509.

Mr Carne also noted that:

[The examination today was difficult due to tenderness. There was a small 1 cm area draining pus in the superior area of the natal cleft to the right at midline. This was remote from the anal canal. On digital examination, there was some irregularity on the posterior aspect of the anal canal. The most impressive feature was that of presacral swelling to the right of midline. This was tender.[59]

[59]Ibid.

On 21 May 2015, Mr Carne’s digital examination of Mr Larman revealed:

[a] large presacral firm mass which was opening into the posterior midline of the anal canal with two associated fistulas, one submucosal and posterior midline and the second towards the natal cleft region. There was no pus present. The presacral tissue mass was very firm. It was not clear whether this was chronic inflammatory or neoplastic.
…
The external opening of the natal cleft was curetted and a vessel loop inserted as loose-draining seton.[60]

[60]Ibid 783.

Biopsies were taken under general anaesthesia, which showed squamous cell carcinoma. Thereafter, Mr Larman was treated with chemoradiotherapy.

On 27 May 2015, Mr Carne removed the seton drain, but it was later replaced and then removed again on 21 April 2016. As of 1 June 2016, Mr Carne’s clinical records indicate that Mr Larman was experiencing minimal discharge, which appears to have been from the natal cleft fistula.[61]
[61]Ibid 501.

On 22 February 2017, Mr Carne noted that there appeared to be an anal fistula with its external opening in the natal cleft region with some surrounding induration.[62] On 16 March 2017, on the three months follow up of Mr Larman’s new pain around the natal cleft fistula, he was recorded as having intermittent discharge and described urgency of bowel motions and was wearing an incontinence pad.[63] On 28 June 2017, Mr Carne recorded that Mr Larman had experienced increasing problems with pain, swelling and discharge from his natal cleft region and that he had a known fistula there. There was a small amount of discharge.[64] At some point thereafter, a seton drain was reinserted. On 9 July 2017, Mr Carne recorded Mr Larman as experiencing problems with pain and swelling and discharge from his natal cleft region and there was a ‘known fistula there’.[65] On 25 September 2019, Mr Carne recorded that Mr Larman had ‘his usual discharge and the seton remains in-situ’.[66] On 7 November 2019, Mr Carne examined Mr Larman under anaesthesia and performed a biopsy and found that there was a chronic cavity associated with the internal opening and a chronic fistula tract in the posterior midline.[67]
[62]Ibid 500.
[63]Pendlebury report, CB 1901.
[64]CB 499.
[65]Pendlebury report, CB 1901.
[66]CB 497.
[67]Ibid 780.

Finally, on 19 May 2021, Mr Carne recorded that Mr Larman was disease free ‘at six years’ ie after the cancer diagnosis, and was ‘managing his seton well’, and ‘we will leave this in-situ’. He recorded that:

There was some talk of considering a colostomy due to poor function; however, this has all resolved and he is not interested in a colostomy at the current time.[68]

[68]Ibid 492.

Mr Keck, who provided a report dated 8 June 2022 to the second defendant’s solicitors, understood Mr Carne’s report of 19 May 2021 as stating that ‘all of [the plaintiff’s] incontinence symptoms had resolved’.[69]
[69]Ibid 156.

Associate Professor Pendlebury’s report also provides information about the impairments caused by the fistulas. She expressed her opinion that:

This man’s anal pain is multi-factorial and with contributions from both his perianal abscesses, fistulae and treatment, was unlikely to be measurably different from that experienced in 2015.[70] (emphasis in original)

[70]Pendlebury report, CB 1903.

That passage suggests that Associate Professor Pendlebury may have considered that Mr Larman was suffering an impairment from both fistulas.

However, Associate Professor Pendlebury’s report suggests that the radiotherapy had led to the incontinence that Mr Larman was experiencing when he was examined by the Panel. That was also the effect of what he told the Panel. As previously mentioned, Associate Professor Pendlebury considered that without the fistula opening to the exterior, ie the natal cleft fistula, the leakage from which has been the essence of Mr Larman’s concerns since the treatment, the risk of ongoing fistula was low and the need for a seton drain was also low.[71] She said that this situation continued until November 2014 when Mr Larman experienced significant pain on sitting and she considered that careful examination at that time would have revealed some early fistula.[72] She reported that by February 2015, the leakage from the natal cleft fistula was beginning and, by then, Mr Larman’s situation was similar to that of his ultimate presentation. She noted that:

The follow up notes after the treatment until November 2016 indicate good bowel control and minimal symptoms. It was not until the fistula reopened at the natal cleft in January 2017 that the incontinence and discharge recommenced.[73]

[71]Ibid.

[72]Ibid.

[73]Ibid.

This material supports Mr Larman’s statements to the Panel that the incontinence and discharge commenced after his chemoradiotherapy.

Again as previously mentioned, Associate Professor Pendlebury described the anal fistula as at February 2013 as small and unlikely to be a lasting problem and that the natal cleft fistula was the main fistula. She stated:

The anal fistula at that time was small, so was unlikely to be a lasting problem and certainly the main fistula with the tract opening near the natal cleft had not developed, so that would not have been the problem it has become. With that, the requirement for a Seton was not present.[74]

[74]Ibid.

The Panel stated that its assessment of Mr Larman’s pre-existing whole person impairment was based on his history and its analysis of the documented, objective medical evidence in relation to his symptoms pre and post the incident and the incident period. Mr Larman informed the Panel of his faecal frequency, urgency and urge incontinence since his radiotherapy treatment commenced in 2015. He told the Panel that he also suffered ‘mild but constant and malodorous ‘discharge from my fistula’ and that ‘all of his underwear is stained’, which he did not experience prior to his cancer treatment.[75] Mr Carne’s and Associate Professor Pendlebury’s reports suggest that the discharge occurring after the radiotherapy was from the natal cleft fistula. That assessment would suggest that, or at least raise the question whether, the anal fistula was a current impairment on 23 May 2023 when the Panel made its determination.
[75]Reasons, p6, CB 64.

The Panel was obliged to decide whether there was evidence which established that Mr Larman had an impairment arising from an unrelated injury or cause, in this case, the anal or submucosal fistula. The Panel had to decide whether that impairment from unrelated injuries or causes was ‘playing a part’ in Mr Larman’s current impairment.

The Panel correctly identified its statutory obligation when it stated that ‘to evaluate the extent to which there is impairment from an unrelated injury or cause which is playing a part in the claimant’s current impairment’, it had given consideration to the decisions in Alcoa Holdings Ltd v Lowthian,[76] and Chua v Lowthian.[77] The Panel therefore correctly understood the test that it had to apply. As previously mentioned:

The Panel noted that the claimant’s anal fistula is both reported by the claimant and documented to have been intermittently symptomatic, with anal pain and a discharge of purulent and/or faecal material, since it was first diagnosed in 1998, and the Panel also noted that the fistula was treated with a seton drain prior to the confirmation of his anorectal carcinoma diagnosis and commencement [of] chemoradiotherapy. [78]

[76]Alcoa Holdings (n 34).

[77]Chua v Lowthian (n 33); Reasons, p 9, CB 67.

[78]Reasons p 10, CB 68.

But it does not appear that the Panel determined that the impairment from the unrelated injury or cause, being the anal fistula, was playing a part in Mr Larman’s current impairment as at 23 May 2023. That was the statutory task that s 28LL(3) required the Panel to undertake. It was not a discretionary consideration that the Panel could decide whether or not to undertake.

The Panel had to do the best it could with the medical records and its examination of the plaintiff, but its evaluation of the impairment from unrelated injuries or causes had to be evidence-based.[79]
[79]Chua v Lowthian (n 33) [135]; Neppessen (n 34) [125]; Bazouni v State of Victoria [2019] VSC 407 [17] (McDonald J).

I was not referred to any medical record which suggested that Mr Larman experienced any post incident symptoms from the pre-existing anal fistula, or that he experienced them as at May 2023. The Panel did not consider a digital rectal examination was necessary to complete its assessment and answer the medical question. The Panel had no medical report of Mr Larman’s condition in respect of fistulas in 2022 or in 2023 before its examination on 23 March. He was then aged 65 years. He informed the Panel that he did not have a general practitioner and that, while he remained as patient of the colorectal surgical team at the Alfred Hospital, his follow-up appointments were once a year. He attended the Hospital’s infectious diseases outpatient department every 6-8 weeks. His seton drain remained in situ. He takes Imodium, a daily anti-viral tablet and three Panadol tablets in the morning for ‘arthritis in my hands and general aches and pains’.

Mr Larman informed the Panel that his faecal frequency and urge incontinence followed the radiotherapy. The Panel did not find that he had an existing condition of anal pain and a discharge of purulent and/or faecal material due to his anal fistula. There was no evidence of such discharge from his anal fistula.

The Panel did not identify how the anal fistula was playing a part in Mr Larman’s impairment in May 2023 and did not refer to any evidence that suggested that it was. There were no medical reports suggesting that it was playing such a role, other than Associate Professor Pendlebury’s, although she described the anal fistula as ‘small’ with the natal cleft fistula as ‘certainly the main fistula’.[80] The reference in Mr Larman’s statement of claim, and the details of his injury in the referral documents to him suffering a submucosal fistula as a result of the defendants’ negligence, was not evidence that such an injury was playing a part in his current impairment in May 2023. Any impairment from the anal submucosal fistula, might for instance, have existed for a short period of time, or have ceased to be an impairment prior to the Panel’s determination.
[80]Pendlebury report, CB 1903.

The Panel’s reference to Mr Larman’s anal fistula as having been reported by him and documented to have been intermittently symptomatic, with anal pain and a discharge of purulent and/or faecal material, since it was first diagnosed in 1998, and that the fistula was treated with a seton drain prior to the confirmation of his anorectal carcinoma diagnosis and commencement of chemoradiotherapy was not a finding that he had an impairment from an unrelated injury or cause, that was playing a part in his current impairment as at 23 May 2023. The Panel referred to the history of his anal fistula, but most of that history was before his chemoradiotherapy treatment in 2015, eight years before the Panel’s determination. Nothing in the Panel’s reasons suggests that it decided that the anal fistula, as an unrelated impairment, was playing a part in Mr Larman’s current impairment when it made its determination.

Before the Panel could disregard a pre-existing and unrelated impairment from injuries or causes associated with the anal fistula it would have had to make an evidence-based determination that the anal fistula was playing a part in Mr Larman’s current impairment. As J Forrest J stated in Alcoa Holdings Ltd v Lowthian,[81] ‘the Panel’s reasons should reveal how it approached the task’, ie the task contained in s 28LL(3). In my opinion, Mr Larman has established that the Panel did not make an evidence-based determination that, at the time of its determination, the anal fistula was playing a part in his current impairment.
[81]Alcoa Holdings (n 34)[75].

The Panel had evidence, including Mr Larman’s statements to it, that at the time of its examination in March 2023, he was suffering from incontinence and faecal discharge. But it did not state that it had formed the opinion that those conditions resulted from the pre-existing fistula or the natal cleft fistula or both. The evidence before the Panel at least raised an issue whether the conditions resulted from the natal cleft fistula and not the anal fistula.

The Panel did not deal with that issue and, in my opinion, its failure to do so was a jurisdictional error as s28LL(3) is only engaged when the Panel finds that an impairment from an unrelated injury or cause is playing a part in the claimant’s current impairment. While the Panel was not obliged to provide reasons as to why it did not make a finding, it could only act under s 28LL(3) after it had found that impairments from unrelated injuries or causes were playing a part in Mr Larman’s current impairment. In circumstances where the medical reports and records and Mr Larman’s statements and the parties’ submissions to the Panel raised the issue I have described, the Panel’s failure to make a finding that the anal fistula was playing a part in his current impairment before it acted under s 28LL(3) constituted a jurisdictional error.

The Court cannot assume that the Panel used its expertise to find that the impairment of the anal fistula was ongoing, when it did not explain that it did that. As J Forrest J stated the Panel’s must reveal how it approached the task imposed by s 28LL(3).[82]
[82]Ibid.

I consider that Mr Larman has established ground two as the Panel concluded that he had a symptomatic anal fistula, which was an unrelated injury or cause, without making an evidence-based finding that the anal fistula was still existing in May 2023 and playing a part in his current impairment. That was a material jurisdictional error.

Third ground - the plaintiff’s contention that the Medical Panel made factual errors

The plaintiff relied on five alleged factual errors made by the Panel which he submitted established that it had not performed its statutory duty and had not properly evaluated his case. Some of these errors were included as particulars to the plaintiff’s second ground in his amended originating motion, but the parties dealt with them as a group when addressing ground three and I will do the same.

Mr Larman pointed to the fact that the Panel only received his solicitors’ submissions including an outline of his case, on 5 May 2023 after it had examined him on 27 March 2023, in circumstances where it had received the second defendant’s submissions in December 2022. The Panel’s determination was made on 23 May 2023. However, it stated that it noted Mr Larman’s submissions into account in making its determination and I see no reason not to act on the basis that it took them into account.[83]
[83]T 97; See also Maribyrnong City Council v Malios [2014] VSC 452 [48].

In Chang v Neil,[84] the Court of Appeal discussed the circumstances in which factual errors may constitute jurisdictional errors, stating:

Factual errors that may constitute jurisdictional error include a failure by the decision-maker to have regard to relevant factual material and the taking into account of such material in a manner that misconstrues its nature or effect (the latter may be described as a constructive failure to have regard to the material). Whether such a factual error amounts to a constructive failure to perform the statutory function conferred on the decision-maker will depend on the importance of the material to the exercise of the function and the seriousness of the error. Jurisdictional error will be committed if the subject matter, scope and purpose of the statutory function indicate that taking into account the relevant material — properly construed — is an essential feature of a valid exercise of the function.[85]

[84][2019] VSCA 151.

[85]Ibid [92].

No jurisdictional error occurs in simply making a wrong finding of fact.[86] Matters of expression and the accuracy of clinical findings on examination do not render the conclusion an invalid exercise of power.[87]
[86]Neppessen (n 34) [149] citing Waterford v The Commonwealth (1987) 163 CLR 52, 77 ( Brennan J).
[87]Ibid [150].

In many instances, a material error will only enable judicial review remedies to be granted if it is established that there is a realistic possibility that the decision that was made in fact could have been different if the error had not occurred.[88]
[88]LPDT (n 27) [7], [16].

Mr Larman’s first allegation of factual error by the Panel was in its finding that ‘the claimant is documented to have first required surgical treatment for a perianal abscess and an associated anal fistula in 1998’.[89] He argued that there was no such documented record and that the Panel’s error in this respect was central to its conclusion that he had a pre-existing impairment consisting of a pre-existing anal fistula.
[89]Reasons, p8, CB 66.

Mr Larman pointed to the information in his medical records of a suspected fistula with an external opening anterior to the anus on the left side near his scrotum in January 2013. For the next two years until March 2015, there was no medical record of any ongoing fistula. In April 2015, a submucosal fistula inside the anal canal posterior to the anus was identified, along with the posterior natal cleft fistula. In late 2017, he underwent two operations at the Alfred Hospital which led to positive findings that he had an ongoing natal cleft fistula, but no other fistula. Further, the Panel did not diagnose that he suffered from any ongoing submucosal fistula as at the date of its determination.

The defendants submitted that documented evidence established that Mr Larman had a drain inserted for the abscess in 1998. In any event, the date on which the pre-existing fistula was documented was not material. The Panel understood that there was a pre-existing anal fistula and used its medical expertise to find that the fistula was ongoing and was causing Mr Larman an impairment at the date of its assessment.

Analysis of the first alleged factual error

I do not consider that the Panel made the first factual error alleged. On the basis of the medical records, it was entitled to conclude that Mr Larman had an abscess associated with a fistula in 1998. His statements to the Panel, as well as Mr Keck’s and Dr Brouwer’s opinions, supported the conclusion that, commencing in 1998, he had an intermittently symptomatic anal fistula for a number of years. Professor Fox considered that from the late 1990s, he had peri-anal issues ‘with abscess and fistula formation with amoebic colitis and cryptosporidium’.

Secondly, Mr Larman alleged that the Panel had erred in finding that he had undergone ‘drainage of a recurrent perianal abscess in December 2007 when the presence of an anal fistula was again noted, and that he was also found to be suffering from perianal cellulitis’.[90] This alleged factual error is similar to that alleged in particular (b) to ground 2 which contends that the Panel overlooked or misunderstood, or misconstrued:

a record that the plaintiff was found to be suffering from perianal cellulitis in December 2017, which the defendants’ submissions to the Panel and the Panel erroneously relied upon as having been made in December 2007 ...

[90]Ibid.

Mr Larman contended that this surgery in fact occurred not in December 2007, but in December 2017. His unreliable recollection of the timing of some events only underscored the importance of the Panel accurately identifying matters documented in the medical material before it relied on them. The date of the surgical treatment for drainage of the abscess was of central importance in the Panel’s consideration of the nature and extent of any pre-existing unrelated injuries or causes affecting the plaintiff.

The defendants submitted that, if the date of 2007 or 2017 had been a significant matter, Mr Larman could have corrected it in his own submissions or by making an affidavit. The Panel recorded that he had confirmed the accuracy of this information, which included the date of December 2007. In addition, the Panel did not refer to the episode of perianal cellulitis in its ultimate conclusion about the application of s 28LL(3) to the facts it had found.

Analysis of the second alleged factual error

I do not accept that this error about the date of the cellulitis finding caused the Panel to make any material error. The Panel does appear to have mistaken the year of that finding, but that did not constitute a jurisdictional error because it was not a consideration that the Panel appears to have taken into account in its conclusion about Mr Larman’s impairments from unrelated injuries or causes. The Panel referred to clinical records which supported its conclusion that he had a long standing anal fistula which had been intermittently symptomatic with anal pain and discharge of purulent and faecal material.

Thirdly, Mr Larman alleged the Panel erred in its conclusion that the second referral letter by the general practitioners to Mr Farmer, a surgeon, appeared to have been written in 2007 ‘based on its location in the Referral material’. He argued that in reaching that finding, that the Panel overlooked material before it which linked the letter to 2003. This alleged factual error is also particular (c) to ground 2.

Mr Larman submitted that by attributing the letter to 2007 rather than 2003, the Panel wrongly assumed that he had suffered from ‘almost continuous leakage of purulent material PR as a suggestive of residual sinus’[91] for an additional three or four years. His general practitioner’s records linked the letter to 2003. The Panel thereby failed to appreciate that there was no record suggesting that he had an anal abscess or fistula between mid-2004 and 2013. That was a matter of central importance to the Panel’s reasoning and conclusions concerning a pre-existing unrelated impairment.
[91]Plaintiff’s submissions in reply, dated 3 June 2024, p4 [18].

The defendants relied on the fact that Mr Larman’s own submissions to the Panel put the referral letter as occurring in 2007. However, they submitted that in any event, any error about this date was not material, because the Panel understood that he had a pre-existing impairment and leakage of purulent material which was intermittently symptomatic. The general practitioner’s referral letter to Dr Farmer in 2003 suggested that these were ongoing problems and they could have continued to 2007.

Analysis of the third alleged factual error

The Panel cannot be criticised for making a finding about the date of a letter which the plaintiff’s own submissions had suggested. In any event, if the second referral letter to Mr Farmer was earlier than 2007, no material error was made, because the Panel had other evidence on which it could find that Mr Larman had a long standing anal fistula. The relevant part of the letter is that the plaintiff, since his perianal abscess was drained in October 1998, had an ‘almost continuous leakage purulent material PR (per rectum)’.[92] The Panel’s ultimate finding was that the plaintiff’s anal fistula was intermittently symptomatic.
[92]Reasons, p 8, CB 66.

Fourthly, Mr Larman alleged that the Panel overlooked, misunderstood or misconstrued material before it which showed that the perianal abscess and suspected fistula identified early in 2013 were a different fistula to the natal cleft fistula which was diagnosed in April 2015 and subsequently treated with a seton drain. The relevant material included the diagram and descriptions in the Alfred Hospital records in 2013 which showed that the abscess and suspected fistula were anterior to the anus on the left side near the plaintiff’s scrotum, whereas the natal cleft fistula which required the seton drain was located some 5cm posterior to the anus. In addition, as previously mentioned, the material before the Panel showed there was a two year period between February 2013 and March 2015 in which there was no documented record of any ongoing fistula or associated purulent discharge. While the defendants did not dispute that the 2013 fistula was a different fistula to the natal cleft fistula diagnosed in 2015, they repeated the contention that the Panel assessed a pre-existing impairment related to a pre-existing submucosal as opposed to a natal cleft fistula. The evidence did not support the defendants’ conclusion that a pre-existing submucosal anal fistula persisted well beyond 2015 and up to the date of the Panel’s determination.

The defendants submitted that the Panel understood and referred to the existence of the two separate fistulas and disregarded the pre-existing impairment from the submucosal anal fistula. There was evidence that that fistula persisted well beyond 2015 to the date of the Panel’s determination.

Analysis of the fourth alleged factual error

For the reasons I gave in considering the plaintiff’s grounds one and two, I consider that the Panel assessed the impairment from the unrelated injury or cause as the anal fistula. The Panel did not make the fourth factual error alleged, Mr Larman’s claim referred to the Panel included allegations that he had suffered injuries of a natal cleft fistula and a submucosal anal fistula. The Panel was obliged to decide if the pre-existing submucosal anal fistula persisted beyond 2015 and up to the date of its determination. I concluded in considering ground two that the Panel failed to make that decision, but I do not consider that the Panel made the fourth error that Mr Larman alleged, which concerned whether the Panel misunderstood that the 2015 natal cleft fistula was a different fistula to the 2013 fistula.

Fifthly, Mr Larman alleged that the Panel erred in finding that he had a pre-existing impairment in the form of discharge of faecal material from a fistula. He submitted that the defendants did not defend this finding and contended only that this error was insufficient to establish jurisdictional error. The Panel stated that the pre-existing impairment was extensive, but did not explain why. The discharge at the time of the Panel’s examination involved constant and malodorous discharge from Mr Larman’s natal cleft fistula, which stained his underwear with an ongoing need for the seton drain. But this was an impairment which resulted from the potentially compensable injury, the natal cleft fistula. This error went directly to the Panel’s impairment apportionment and conclusion that there was a pre-existing impairment unrelated to an incident period which was ‘extensive’.

The defendants submitted that Mr Larman had informed the Panel that he had discharges of purulent and faecal material over the years. There was ample evidence that supported the existence of that discharge including the referral letters to Mr Farmer. The Panel was entitled to find that Mr Larman had symptomatic and pre-existing anal abscesses and fistulas that pre-dated the incident and incident period.

Analysis of the fifth alleged factual error

This alleged factual error is not established. The evidence before the Panel entitled it to reach the conclusion that Mr Larman had had an impairment of faecal discharge, which was intermittently symptomatic. This evidence included his own account of his medical history and the medical records, which recorded his treatment for anal discharges. The error made by the Panel was in not making a finding whether the discharge Mr Larman was experiencing in 2023 was an impairment from an unrelated injury or cause, being the anal fistula, which was playing a part in his current impairment.

Mr Larman has not established that the Panel made material factual errors which would constitute a jurisdictional error. Ground three is not established.

Conclusion

Grounds one and three are not established.

Ground two is established and was a material jurisdictional error. As a result, the Court will issue judicial review orders in the nature of certiorari quashing the Panel’s determination of 23 May 2023 and an order in the nature of mandamus requiring a differently constituted Medical Panel to determine the referred medical question according to law.

I will hear the parties on costs.

SCHEDULE OF PARTIES

BETWEEN:
JAMES LARMAN	Plaintiff
AND
*DRS SUSANNE HOMOLKA CONSTITUTING THE MEDICAL PANEL PURSUANT TO THE WRONGS ACT 1958* (VIC)**	First Defendant
ALFRED HEALTH	Second Defendant
DR SVEN STRECKER	Third Defendant
DR VINCENT CORNELISSE	Fourth Defendant

[2024] VSC 756

5 December 2024