Lilly v Tomago Aluminium Company Pty Limited
[2004] NSWWCCPD 62
•2 September 2004
WORKERS COMPENSATION COMMISSION
APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:Lilly v Tomago Aluminium Company Pty Limited [2004] NSW WCC PD 62
APPELLANT: Eric Norman Lilly
RESPONDENT: Tomago Aluminium Company Pty Limited
INSURER:QBE Workers Compensation (NSW) Ltd
FILE NUMBER: WCC10880-03
DATE OF ARBITRATOR’S DECISION: 16 March 2004
DATE OF APPEAL DECISION: 2 September 2004
SUBJECT MATTER OF DECISION: Appeal Against an award of expenses under Section 60 of the Workers Compensation Act 1987. Leave Threshold in section 352 of the Workplace Injury Management and Workers Compensation Act 1998. Error of law.
PRESIDENTIAL MEMBER: Dr Gabriel Fleming
HEARING:On the papers
REPRESENTATION: Appellant: Bale Boshev Lawyers
Respondent: Moray &Agnew Solicitors
ORDERS MADE ON APPEAL: The decision of the Arbitrator is confirmed.
CONTENTS
THE APPEAL PARAGRAPHS 1 – 5
ISSUES IN DISPUTE PARAGRAPHS 6 - 8
LEAVE PARAGRAPHS 9 - 17
EVIDENCE AND SUBMISSIONS PARAGRAPHS 18 - 33
DISCUSSION AND FINDINGS PARAGRAPHS 34 - 53
DECISION PARAGRAPH 54
THE APPEAL
On 13 April 2004 Eric Lilly (‘the Appellant/Mr Lilly’) sought leave to bring an ‘Appeal Against Decision of Arbitrator’ in the Workers Compensation Commission (‘the Commission’) against a decision, dated 16 March 2004.
The Respondent to the Appeal is Tomago Aluminium Company Pty Limited (‘the Respondent Employer’).
The appeal concerns a claim by Mr Lilly for medical expenses associated with an injury to his right knee. The Arbitrator made an award in favour of the Respondent in respect of Mr Lilly’s claim for medical and related expenses under section 60 of the Workers Compensation Act 1987 (‘the 1987 Act’).
The appeal was referred to me for review on 10 August 2004.
I am satisfied that I have sufficient information to proceed ‘on the papers’, pursuant to Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) without holding any conference or formal hearing, and that this is the appropriate course in the circumstances.
ISSUES IN DISPUTE
The first issue in dispute is whether or not the Appellant can meet the threshold test for leave to appeal.
The second issue is whether or not the Arbitrator erred in the application of section 9A of the 1987 Act and in finding that Mr Lilly’s employment was not a ‘substantial contributing factor’ to his injury.
The Respondent argues that leave should be refused and that the Arbitrator’s decision should be confirmed.
LEAVE
Before proceeding to hear the appeal the Commission must determine whether the application meets the requirements of section 352 of the 1998 Act, which provides as follows:
“352Appeal against decision of Commission constituted by Arbitrator
(1) A party to a dispute in connection with a claim for compensation may, with leave of the Commission constituted by a Presidential member, appeal to the Commission as so constituted against a decision in respect of the dispute by the Commission constituted by an Arbitrator.
(2) The Commission is not to grant leave to appeal unless the amount of compensation at issue on the appeal is both:
(a)at least $5,000 (or such other amount as may be prescribed by the regulations), and
(b)at least 20% of the amount awarded in the decision appealed against.
(3) If the Commission refuses to grant leave to appeal, the Commission must state reasons for the refusal in writing to the parties.
(4) An appeal can only be made within 28 days after the making of the decision appealed against.
(5) An appeal under this section is to be by way of review of the decision appealed against.
(6) Evidence that is fresh evidence or evidence in addition to or in substitution for the evidence received in relation to the decision appealed against may not be given on an appeal to the Commission except with the leave of the Commission.
(7) On appeal, the decision may be confirmed or may be revoked and a new decision made in its place.
Alternatively, the matter may be remitted back to the Arbitrator concerned, or to another Arbitrator, for determination in accordance with any decision or directions of the Commission.
(8) In this section, decision includes an award, interim award, order, determination, ruling and direction.”
The Appeal was lodged within 28 days of the Arbitrator’s decision in compliance with subsection 352(4) of the 1998 Act.
No amount was awarded in the decision appealed against and therefore section 352(2)(b) of the 1998 Act has no application (Mawson v Fletchers International Exports Pty Limited [2002] NSW WCC PD 5).
The claim that was made to the Employer, and was before the Arbitrator, was for “$280.00 to date and continuing”. The Appellant submits that the threshold of $5,000, in section 352(2)(a) is met because:
“A specific or general order in relation to proposed surgery was sought. The particulars as to that expense are outstanding. A letter of 24 October 2003 requesting report from Dr Berton was admitted into evidence pursuant to Directions made at teleconference on 15 December 2003. Dr Berton has not provided an opinion as to the cost of the Total Knee Replacement.
It is submitted the cost of the Total Knee Replacement would be at least $5,000 including surgeon, anaesthetic, prosthetic, hospital and ancillary expenses.”
The Respondent submits leave to appeal should be refused because there was no evidence before the Arbitrator of the cost of future surgery, nor any commitment to surgery actually being undertaken. This leaves the amount of the claim at $280, considerably less than the $5,000 threshold required by section 352(2)(a) of the 1998 Act.
The Arbitrator accepted that the Appellant was entitled to seek a general order in relation to future treatment, namely the proposed knee replacement surgery. However, the Appellant failed to submit any particulars of the order sought.
On 10 August 2004 I granted leave to the Appellant to file ‘fresh evidence’, being evidence of “the cost of a total knee replacement including surgeon, anaesthetic, prosthetic, hospital and ancillary expenses”. The Appellant filed a ‘Knee Replacement Costing’ of Dr Berton, which estimated the cost of hospital fees alone as $10,000- $15,000.
I am satisfied the amount of compensation at issue on the appeal is more than $5,000.
Leave to appeal is granted.
EVIDENCE AND SUBMISSIONS
Relevant Facts
The facts are set out in the Arbitrator’s decision and are not repeated in full here. In summary, Mr Lilly claims to have suffered an injury to his right knee when lifting a piece of bath at his workplace on 24 October 1999. He advised his employer of the injury on the same day and on 29 October 1999 made a claim for medical expenses related to the injury. This was refused by the Insurer.
Mr Lilly had some time off work after the incident of 24 October 1999 and returned to work on light duties. He resumed normal duties in early January 2000 and has continued to work, albeit with reports of ongoing pain.
A second claim, for an amount of $280 and continuing related medical expenses, was made on the Employer on 12 June 2003.
Mr Lilly had previously injured his right leg in a motor bike accident some thirty five years earlier. Mr Lilly had also previously fractured his right femur playing basketball. There was considerable specialist medical evidence before the Arbitrator, which indicated that Mr Lilly had advanced degenerative changes in his right leg.
Dr Berton, Mr Lilly’s treating Orthopaedic Surgeon, provided a number of medical reports and on 17 January 2000 opined that the “work injury did lead to an aggravation of an underlying condition and that aggravation has now ceased from a work point of view”. Dr Wilding, Orthopaedic Surgeon, was of the view that Mr Lilly would not have developed “symptoms due to the underlying osteoarthritic change in the right knee” (report of 17 July 2003) if the incident at work on 24 October 1999 had not occurred. Dr Caldwell, Orthopaedic Surgeon, stated that the incident of 24 October 1999 caused an aggravation of a previous underlying condition and the aggravation had ceased (report of 7 July 2000).
The Relevant Law
The relevant provisions considered by the Arbitrator for the purpose of his determination were, sections 4, 9A and 60 of the 1987 Act. These provide as follows:
“Section 4
injury:
(a) means personal injury arising out of or in the course of employment,
(b) includes:
(i)a disease which is contracted by a worker in the course of employment and to which the employment was a contributing factor, and
(ii)the aggravation, acceleration, exacerbation or deterioration of any disease, where the employment was a contributing factor to the aggravation, acceleration, exacerbation or deterioration, and
(c) . . .”
“9ANo compensation payable unless employment substantial contributing factor to injury
(1) No compensation is payable under this Act in respect of an injury unless the employment concerned was a substantial contributing factor to the injury.
(2) The following are examples of matters to be taken into account for the purposes of determining whether a worker’s employment was a substantial contributing factor to an injury (but this subsection does not limit the kinds of matters that can be taken into account for the purposes of such a determination):
(a)the time and place of the injury,
(b)the nature of the work performed and the particular tasks of that work,
(c)the duration of the employment,
(d)the probability that the injury or a similar injury would have happened anyway, at about the same time or at the same stage of the worker’s life, if he or she had not been at work or had not worked in that employment,
(e)the worker’s state of health before the injury and the existence of any hereditary risks,
(f)the worker’s lifestyle and his or her activities outside the workplace.
(3) A worker’s employment is not to be regarded as a substantial contributing factor to a worker’s injury merely because of either or both of the following:
(a)the injury arose out of or in the course of, or arose both out of and in the course of, the worker’s employment,
(b)the worker’s incapacity for work, loss as referred to in Division 4 of Part 3, need for medical or related treatment, hospital treatment, ambulance service or occupational rehabilitation service as referred to in Division 3 of Part 3, or the worker’s death, resulted from the injury.
(4) . . . .”
“60Compensation for cost of medical or hospital treatment and rehabilitation etc
(1) If, as a result of an injury received by a worker, it is reasonably necessary that:
(a)any medical or related treatment (other than domestic assistance) be given, or
(b)any hospital treatment be given, or
(c)any ambulance service be provided, or
(d)any occupational rehabilitation service be provided, the worker’s employer is liable to pay, in addition to any other compensation under this Act, the cost of that treatment or service and the related travel expenses specified in subsection (2).
Note. Compensation for domestic assistance is provided for by section 60AA.
(2) . . .
(3) . . . .
(4) . . . .”
The Arbitrator’s Decision
The Arbitrator found that on 24 October 1999 Mr Lilly had suffered a frank ‘injury’ to his right knee arising out of or in the course of his employment as an operator with Tomago Aluminium.
The Arbitrator then considered the “medical and factual histories” before him. He does not expressly find what the nature of that injury was, but states that “the predominant diagnosis of all three specialists is that the October 1999 injury aggravated what was already a significant underlying degenerative change, but that specifically, any such frank injury aggravation has ceased” (at paragraph 24 of the reasons). He reasons that it is necessary to review the medical evidence in order to determine whether Mr Lilly’s employment was a ‘substantial contributing factor’ to his injury in accordance with section 9A of the 1987 Act.
The Arbitrator concluded that “on the best of the available evidence before me, I am not satisfied that, whilst a workplace ‘injury’ occurred, the employment was a substantial contributing factor for the purposes of compensation on this presentation, including pursuant to s9A”.
The Arbitrator also found no support in the medical evidence presented by the Appellant for the claim that knee replacement surgery was the current recommended treatment.
As a result of this analysis the Arbitrator found that the Respondent was not liable to pay medical or related expenses to Mr Lilly in relation to the injury.
The Appellant’s Submissions
The Appellant submits the Arbitrator erred in the application of section 9A of the 1987 Act, in that he mistook:
“the concept of injury with the overall loss or impairment. . . . The Arbitrator appears to have applied s.9A in a quantitative manner so as to apply it to the benefit of s.60. . . . In the applicant’s case the frank injury has caused an aggravation which has caused symptomology. Medical treatment has been applied to alleviate the symptomology caused by the aggravation, and thus the medical treatment flows from the injury.”
The Appellant submits “once injury is found the Act requires that s.60 be applied without apportionment so as to provide to the worker a benefit so as to cure or alleviate the physical effects produced by the injury [sic]”.
The Appellant argues there is “ample evidence to support the applicant’s claim that the s.60 expenses arose as the result of the ‘injury’”. He points to the reports of Dr Berton of 23 February 2003 and 31 October 2003, and to a lesser extent the report of Dr Wilding of 17 July 2003.
The Respondent’s Submissions
The Respondent submits that the Arbitrator’s interpretation of section 9A of the 1987 Act was correct and that s60 does not ‘stand[s] outside’ section 9A of the 1987 Act. The Respondent agrees that there was no dispute that the Appellant had an underlying problem with his knee and submits that “ the Arbitrator’s task was to assess the relevance of the work injury in the context of s9A which he did without manifesting any error”.
The Respondent argues that “even if the Arbitrator’s approach to s9A was erroneous (which is certainly not conceded) he found as a fact in the alternative that any employment aggravation had ceased. In other words at a factual level, causal nexus for the purposes of the s60 expenses claimed was not established.”
DISCUSSION AND FINDINGS
Did the Arbitrator make an error of law, fact or discretion?
An Arbitrator’s decision should not be disturbed unless, on review, it is found to be affected by an error of law, fact or discretion (Allesch v Maunz (2000) 203 CLR 172; Mayne Health Group t/as Nepean Private Hospital v Sarah Sandford [2002] NSW WCC PD 6).
The error must be such that a different decision should have been made had it not occurred (Section 294 of the 1998 Act; YG & GG v Minister for Community Services [2002] NSWCA 247; Absolon v NSW TAFE [1999] NSWCA 311).
The Arbitrator’s approach to the application of section 9A of the 1987 Act to the facts of this case is not completely clear to me from the reasons. It appears that, in concluding employment was not a substantial contributing factor “on this presentation”, the Arbitrator has considered the matters in section 9A in relation to the status of the Appellant Worker’s injury at the date of his claim for medical expenses. The words ‘on this presentation’ suggest some confusion as to whether the section 9A matters were considered in relation to the ‘injury’, being the aggravation of an underlying degenerative condition, or the ‘injury’, being the degenerative condition itself, as it presented at the time the claim for medical expenses was made. If it was the latter then it is inconsistent with the earlier implied finding that an ‘aggravation’ had occurred for the purpose of section 4 of the 1987 Act.
On the basis of the Arbitrator’s reasons for decision, I accept the Appellant’s submission that the Arbitrator has erred in the interpretation of section 9A of the 1987 Act and its application to the facts of this case. The Arbitrator refers to the medical evidence in relation to the nature of the injury and to a number of relevant authorities (Mercer v ANZ Banking Corporation (1998) 17 NSWCCR 264; Harper v State Rail Authority (NSW) [2000] NSWCC 3; Cant v Catholic Schools Office (2000) 20 NSWCCR 88). However he does not set out his findings as to the nature of the injury and the weight, if any, he has given to matters that he states must be considered pursuant to section 9A of the 1987 Act.
Having determined that Mr Lilly suffered an ‘injury’ for the purpose of section 4 of the 1987 Act, three further questions must be answered to determine whether Mr Lilly is entitled to compensation for medical expenses related to this injury. They are:
· What was the nature of the injury suffered?
· Was Mr Lilly’s employment a substantial contributing factor to the injury (section 9A of the 1987 Act)?
· Are the medical expenses he has claimed reasonably necessary as a result of the injury (section 60 of the 1987 Act)?
Injury
Mr Lilly’s evidence, which is not challenged in the evidence and was accepted by the Arbitrator, is that an ‘incident’ occurred on 24 October 1999 when he was working for Tomago Aluminium Company Limited as an operator. In his statement filed in the proceedings he describes what happened thus:
“ The previous night had not cleaned up the area properly and there were lots of lumps of bath left on the operating floor. I was doing some cleaning up, and I was lifting up a 15 kg lump of bath with my hands. Unfortunately there was an area that I was standing on with broken lumps of bath and as I went to lift up the piece of bath my right foot slipped sideways twisting it badly and I struck my right knee on the ground. I felt a pretty bad pain in my knee but I kept working. The pain gradually got worse. It got especially bad when I was driving home.”
It is not disputed that Mr Lilly had injured his right knee on previous occasions, in a motor bike accident and playing basketball.
On the evidence before me it is clear that Mr Lilly suffered a frank injury on 24 October 1999 and that this injury arose ‘out of his employment’ in that there was a temporal connection (Smith v Australian Woollen Mills Ltd (1933) 50 CLR 504). He was at work and lifting a heavy object when he fell and injured his knee.
As the Arbitrator states, the medical evidence of Dr Berton and Dr Wilding overwhelmingly concludes that the injury was an aggravation of a pre-existing degenerative condition of his right knee. This much is not challenged on appeal.
Substantial Contributing Factor
In considering whether Mr Lilly’s employment was a substantial contributing factor to the aggravation of the underlying degenerative condition of his right knee, it is relevant that:
· The injury occurred at work at 9pm, which was during his normal working hours,
· The nature of the task he was performing required him to lift the heavy piece of bath in order to “clean up” the operating floor,
· He had been working for the Respondent for about nine years, since 1990, when the injury occurred,
· It is unlikely that Mr Lilly would have injured himself in a similar way if he had not been at work,
· There is no evidence that Mr Lilly’s previous knee injuries contributed to the likelihood of this injury, being a specific aggravation to his pre-existing condition, and
· There is no evidence that his lifestyle or other activities outside of work contributed to the aggravation of his pre-existing condition.
It cannot be said, on the evidence before me, that Mr Lilly’s injury occurred merely because he was at work at the time. There was clearly a conjunction of factors, as outlined above, which gave rise to the incident where he tripped on broken lumps of bath when lifting the piece of bath.
I therefore find that Mr Lilly’s employment was a ‘substantial contributing factor’ to his injury for the purposes of section 9A of the 1998 Act.
Entitlement to Medical Expenses
Mr Lilly has essentially made two claims under section 60. The first claim relates to an expense of $280 that he incurred for the cost of X-rays of his right leg that were carried out on 24 February 2003, some three and a half years after he fell at work on 24 October 1999. The second claim is for a continuing award to cover the cost of a total knee replacement of his right knee at some future, not nominated, date.
The 1987 Act provides for compensation for medical expenses only after they are incurred and properly verified. Section 60 is an indemnity provision (NSW Sugar Milling Co-op v Manning (1998) 44 NSWLR 442). It is therefore not appropriate for an Arbitrator to make an order pursuant to section 60 of the 1987 Act for a specified sum, based upon likely future costs. However, this is not a bar to an Arbitrator making a finding that an employer is liable for certain future medical expenses under section 60, which will then become payable as they are incurred (Water Taxis Combined Pty Limited and Harbour Taxi Boats Pty Limited v Wells [2004] NSW WCC PD 30).
To be entitled to compensation for the costs of medical or related expenses under section 60 of the 1987 Act, a worker must demonstrate that these expenses are reasonably necessary “as a result of an injury received by the worker”, being the ‘injury’ as defined in section 4 of the 1987 Act.
The Arbitrator sets out the relevant findings of the medical specialists whose reports were in evidence in the proceedings. I agree with this summary (at paragraph 24 of the reasons). The weight of medical evidence supports the conclusion that on 24 October 1999 Mr Lilly suffered an injury, being an aggravation of an underlying degenerative condition of his right knee.
Dr Berton provided a number of reports on Mr Lilly’s condition. The Appellant refers to Dr Berton’s report of 23 February 2003, where he concedes that there is difficulty in “apportioning what problems are constitutional and what problems are related to his work related injury”. However, as early as 17 January 2000 Dr Berton reported that, “It would seem that his work injury did lead to an aggravation of an underlying condition and that aggravation has now ceased from a work point of view.”
While not specifically making a finding in relation to the weight of the relative medical evidence, it is clear that the Arbitrator was persuaded by Dr Berton and Dr Wilding, that “the predominant diagnosis of all three specialists is that the October 1999 injury aggravated what was already a significant underlying degenerative change, but that specifically, any such frank injury aggravation had ceased” (at paragraph 24 of the reasons). In my view the medical evidence leads overwhelmingly to this conclusion.
It follows that the cost of the X-rays ($280) carried out in February 2003 and the future cost of a total knee replacement are not incurred ‘as a result of the injury’ received by Mr Lilly at work in October 1999 (Section 60 of the 1987 Act, Corrigan v CL Brown & Sons (1998) 16 NSWCCR 681). The work injury was an aggravation of an existing degenerative condition and the aggravation has, on the medical evidence, ceased some time ago, at least by January 2000 when Dr Berton reported. The Respondent is therefore not liable to pay Mr Lilly for these expenses, pursuant to section 60 of the 1987 Act. Had the claim related to medical expenses related to the frank injury of 24 October 1999 and incurred between October 1999 and January 2000, the outcome may well have been different.
While the Arbitrator’s decision is affected by error, review of his decision leads to the same outcome, namely an order in favour of the Respondent. In this circumstance the Arbitrator’s decision should be confirmed.
DECISION
The decision of the Arbitrator is confirmed.
Dr Gabriel Fleming
Deputy President
2 September 2004
I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF DR GABRIEL FLEMING, DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
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