McDermid and Comcare - [2000] AATA 176

`

DECISION AND REASONS FOR DECISION [2000] AATA 176

ADMINISTRATIVE APPEALS TRIBUNAL )

) No Q1998/583

GENERAL ADMINISTRATIVE DIVISION )

Re WILLIAM JOHN McDERMID
Applicant

And COMCARE
Respondent

DECISION

Tribunal Mr K L Beddoe (Senior Member) Miss A M Brennan AM (Member) Dr K P Kennedy OBE (Member)

Date8 March 2000
PlaceBrisbane

Decision The decision under review is affirmed.

…………………………………..
Decision No. Senior Member
CATCHWORDS
COMPENSATION : Incapacity payments – Partial incapacity for work – Incapacity for work – "Degenerative disc disease" – Loss of earning capacity

Compensation (Commonwealth Government Employees) Act 1971 – s27, s46
Safety, Rehabilitation and Compensation Act 1988 – s124(1A)

Arnotts Snack Products Pty Ltd v Yacob (1985) 155 CLR 171
Williams v Metropolitan Coal Co. Ltd (1948) 76 CLR 431
Asioty v Canberra Abattoir Pty Ltd (1989) 87 ALR 385
8 March 2000 REASONS FOR DECISION

Mr K L Beddoe (Senior Member) Miss A M Brennan AM (Member) Dr K P Kennedy OBE (Member)

The applicant seeks review of a decision of Comcare which decided to pay weekly compensation for incapacity payments to the applicant from 1 January 1994 (T41). That decision was affirmed on review (T45). The applicant contests the decision because, he says, the date of effect should be backdated to the time of his discharge from the Navy (25 November 1985).
Section 27 of the Compensation (Commonwealth Government Employees) Act 1971 ("the 1971 Act") provides for payment of compensation for personal injuries arising out of or in the course of employment by the Commonwealth.
In so far as is relevant section 124(1A) of the Safety, Rehabilitation and Compensation Act 1988 provides that a person is entitled to compensation under the Act in respect of an injury suffered before 1 December 1988 if compensation was or would have been payable to the person under the 1971 Act.
At the hearing Mr Crosby appeared for the applicant and Mr Bickford appeared for the respondent. The documents lodged in the Tribunal pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 were before the Tribunal as the T documents and further documents were tendered and marked as exhibits. Oral evidence was given by the applicant, his former employer, Dr Hodgkinson, Dr Ryan, Dr Boys and Dr Stuart.
The applicant served in the Navy from 26 November 1965 to discharge on non-medical grounds on 25 November 1985. On discharge he held the rank of Petty Officer. His Naval duties were as a radio operator.
While serving in the Navy he lodged a claim for compensation (T3) for degenerative disc disease said to be caused by playing rugby for H.M.A.S. Harman. He nominated 11 May 1975 as the date of original injury and 11 July 1977 as the date of recurrence of the injury. While the claim seems to assert that both incidents occurred while at H.M.A.S. Harman the medical records make it clear that the applicant was serving at H.M.A.S. Coonawarra in July 1977. The applicant returned to H.M.A.S. Harman prior to lodging the claim for compensation. It should also be noted that the incident report for the 11 May 1975 describes "bruising of left hip radiating to back area."
The applicant said on discharge from the Navy that he suffered degenerative disc disease from 9 April 1979, supraspinatus tendonitis of the left shoulder, the left ring and small finger from 8 November 1982. Although the applicant listed six occasions on which he suffered disabilities during service he did not list the football incidents (T11). That may be explained by the applicant's oral evidence that he continued to play football for the Navy notwithstanding the 1975 and 1977 incidents, did not take time off from his duties because of the incidents and because he believed he had fully recovered from the 1975 incident. He said he was still playing sport into the 1980's.
On 25 June 1984 a determination was made under the 1971 Act accepting liability for personal injury arising out of or in the course of the applicant's Naval Service, in respect of the 3 September 1979 incident. The disability accepted was aggravation of a pre-existing injury resulting in degeneration of the L2/L3 disc.
Upon leaving the Navy the applicant found work difficult to obtain and he eventually purchased a bread round in Toowoomba. The bread round involved travel of 420km per day and the sale of 4-5000 units of bread to shops each day. In so doing he was required to carry crates of bread. After 6 months he sold the bread round to his brother-in-law because he needed to have operations for his shoulder and a hernia. He said in his evidence that he purchased the business for $47,000 and sold it at a loss of $8,000+. He was apparently on social security benefits for several months in 1987. In this regard Dr Gillespie certified incapacity because of the hernia, rotator cuff calcification of left shoulder and lumbar disc disease (Exhibit A).
Following the operations he worked for an M.G. Grant doing painting and sandblasting work. He said in his evidence that he suffered discomfort to his back doing this work but did not seek medical attention.
In July 1988 he obtained employment as a radio officer on an off-shore oil rig. This involved working in Bass Strait and also the Timor Sea and was work that he was eminently qualified for because of his Navy experience. He says he suffered discomfort while working as radio officer and he was given Voltaren for relief. This work continued until 1991 but was terminated that year because he did not have the required certification to meet the qualifications demanded by the relevant union. While employed he did 12 hour shifts working 28 days on and 28 days off. Although he says he suffered back pain he was able to perform his duties as radio officer and his employment was only terminated at the insistance of the union in February 1991.
He then obtained employment with a business installing television antennas. That employment had aspects that were not satisfactory to both the applicant and the employer, partly because of the applicant's back condition. He says he did not seek medical assistance because Dr Baddeley had told him in 1984 that the next step was an operation which he did not want to undergo.
The applicant's former employer said in evidence that the applicant was employed from 1 September 1991 to 13 November 1993. He said the applicant had difficulty with some aspects of antenna installation but could get on to roofs and into most ceilings. Because of the applicant's complaints about his back he was given alternative reception and delivery duties after some 6 to 12 months of employment on antenna installation. Due to a subsequent downturn in business and because of aspects of the applicant's duties were really a duplication of work he terminated the applicant's employment.
The applicant gave evidence that he pursues woodworking as a hobby. A report by CRS dated 1 August 1996 (T21) records an outline of the applicant's then proposal to set up a specialised woodworking business at his home. We understand the business proposal was not implemented.
The applicant then obtained work with an office furniture business but this employment was cut short, he says, because his back condition meant he couldn't handle the work and he ceased work after three months.
The applicant worked for a home cleaning service with a view to purchasing a franchise but declined to continue after two months because he says he was unable to do the work. It is not clear to the Tribunal as to when this last period of work occurred but the respondent seems to have accepted that remunerative employment ceased in mid-1994 (T41).
The respondent resumed payment of incapacity payments to the applicant with effect from 1 January 1994 having previously made such payments for the period 21 November 1986 to 8 February 1987.
The medical evidence
The Medical Officer at H.M.A.S. Coonawarra reported by memorandum dated 20 August 1981 that the applicant had the following "back injuries":
a.Strained sacro-iliac joint 3 Sep 79 occurred at football. Duty status unspecified. Treatment – Brufen and liniment.
b.Bruised right sacro-iliac joint 8 Apr 79. Cause or duty status unspecified. Treatment heat, Butazolidin.
c.Bruised left sacro-iliac joint 11 Jul 77. His notes refer vaguely to a four week history, cause and duty status unspecified. Treatment Indocid.
d.Bruised left hip 11 May 75. No reference to back injury as such.
There is no evidence in this sailor's medical documents of any specific injury to the lower spine. The "degenerative disc disease" referred to was first discussed on x-ray 28 Jul 77. Presumably this x-ray was requested in relation to the condition referred to in Para 1 section c. (T5)
In a report dated 6 September 1982 Dr Baddeley, Orthopaedic Surgeon, said the applicant was experiencing significant pain in the middle portion of the lumbar spine. He also reported that X-rays showed gross anterior narrowing of the L2/L3 disc space with large osteophytes. He also said there was a defect on the superior aspect of the 4th lumbar vertebrae anteriorally, which he said was classically that of old Scheuermann's disease.
By a report dated 20 January 1983 Dr Baddeley diagnosed supraspinatus tendonitis of the left shoulder which had been present for five or six weeks and developed spontaneously. No abnormality was seen. He also reported an anterior acromionectomy performed on the left shoulder with division of the coraco-acromional ligament (T7).
Dr Baddeley saw the applicant again in December 1983 noting a history of back injury whilst playing rugby in 1975 and the shoulder injury consistent with playing rugby. He noted limitations because of the back problem but did not feel the applicant was likely to have a significant functional disability (T8).
Dr Bromwich reported that he examined the applicant on 23 February 1984 (T9). He was told that in 1975 the applicant was butted on the left hip at football. Local bruising and pain was reported but after a few weeks all signs and symptoms had gone. A different pain was developed in the low back in 1977 without any recollection of a precipitating factor. The applicant gave a history to Dr Bromwich which did not include recollection of a recorded football injury in 1979. The applicant agreed with the history recorded.
Dr Bromwich found an almost full range of movement with some pain at the extremes of flexion and lateral flexion. X-rays in 1982 showed gross narrowing of the L2/L3 disc space with osteophyte formation. Dr Bromwich reported that a defect in the body of the fourth lumbar vertebra is consistent with old Scheuermann's disease. Dr Bromwich concluded that the applicant was suffering pain arising from a longstanding degeneration of the L2/L3 disc.
By a report dated 15 April 1998 (Exhibit 1) Dr Curtis, Orthopaedic Surgeon, found on examination, moderate restriction of movement of the lumbar spine in all planes amounting to some 25%. Outright leg raising was full with no abnormal neurological signs in his lower limbs, apart from some numbness of the lateral aspect of the left thigh and calf.
In a report dated 2 August 1994 Dr Boys, Orthopaedic Surgeon, sets out a history based on the football incident said to have occurred on 11 May 1975 (T14). Examination showed that the applicant walked normally. Sitting posture was normal and spine straight with slight tenderness evident over the mid-thoracic spine. Some tenderness was also evident in the midline over the lower lumbar spine with spinal movements well preserved.
Dr Boys diagnosed Cervical, Thoracic and Lumbar osteoarthritic degenerative disease with L2/L3 degenerative disc disease in the context of old Scheuermann's disease. He said it was reasonable to believe that the football injuries sustained in 1975, 1977 and 1979 aggravated or accelerated degeneration at the L2/L3 level. There was also age related degeneration throughout the cervical, thoracic and lumbar spines found. Dr Boys expressed the opinion that the degenerative spinal condition had been aggravated by military service with acceleration at L2/L3 due to a possible traumatic event.
He found a partial incapacity to work but the applicant was fit for sedentary employment with restrictions as to activities to be performed.
In a further report dated 15 April 1996 and also addressed to the respondent, Dr Boys followed the diagnosis of his previous report but made no specific mention of the L2/L3 spondylosis (Exhibit 1). He criticised the provision of physiotherapy saying it had been of no benefit and also noted that the rehabilitation program was ineffective because the applicant was not self motivated towards rehabilitation. He said the applicant was currently unemployable and in the absence of real motivation to rehabilitate himself into the workforce would remain so.
In his oral evidence Dr Boys said that the applicant's degenerative condition was greater than would be expected for the applicant's age. He said the L2/L3 disc was not normally prone to spondylosis.
Dr Boys said that this was not a case where the injury had been overtaken by natural degeneration. He said the applicant complained of pain but this could only be a subjective assessment. Dr Boys reaffirmed his opinion that the applicant was capable of performing sedentary employment when he saw the applicant in 1994 and 1996.
Documents T22 and T23 include reports by Dr Ho, Orthopaedic Surgeon, who was not called to give evidence. He saw the applicant in 1997 and took a history which related the injury playing football in 1975 and took into account clinical notes provided. He diagnosed L2/L3 spondylosis with most likely involvement also at L4/L5 and L5/S1 junction resulting in chronic low back pain.
The Tribunal also heard evidence from two general practitioners. Dr Hodgkinson made written reports which are documents T16 and T19 and dated 9 December 1994 and 6 May 1995 respectively. Dr Hodgkinson described problems initially in the lower back and subsequently in the following areas:
(a)Cervical Spine.
(b)Mid Thoracic Spine.
(c)Lumbar Sacral Spine.

He described generalised spondyloarthritis in the spine.

Dr Hodgkinson was called for cross examination by the respondent. In his oral evidence he described treatment prescribed being mainly anti-inflammatory treatment. He said that in his opinion the applicant had not been fit for work since 1994. He also noted a reluctance by the applicant to take powerful pain killer treatment.
Dr Stuart, General Practitioner, provided a report to the respondent dated 25 March 1987 (T17, T18, T20). She reported a problem with the applicant's left shoulder which had an adverse effect on his occupation as bread vendor in September 1986. Dr Stuart also reported pain in the lower back which radiated down both legs. Dr Stuart also reported the operation on the applicant's left shoulder in December 1986 with return to light duties employment from 8 February 1987. The operation included repair of a right inguinal hernia. The shoulder and lower back pain prevented the applicant working in the period following the operation.
In oral evidence Dr Stuart said that the applicant's shoulder problem had been more serious than his lower back pain. Both the shoulder condition and the hernia had more or less resolved following the operation. The back had been an on and off problem.

The contentions

The applicant says that there is a consistent history of lower back injury from the time of the football injury in 1975. There was a continuing condition which was an injury under the 1971 Act causing partial incapacity (section 46). The applicant acknowledges that he was working during most of the time from February 1987 to December 1993.
The respondent cited a number of authorities to support its contention that there was not an incapacity to engage in work because the applicant had taken a voluntary discharge from the Navy. The applicant's subsequent work as a radio operator on oil rigs had shown that he was fit to perform his naval duties after he left the Navy.
Consideration
It is clear, on the material, that the applicant suffers chronic pain attributable to lumbar spondylosis in particular but also a more general degenerative condition of the spine. It is also clear on the material that the applicant suffered injuries during his service in the Navy. It is not clear, however, as to what continuing effect these injuries had and, in particular, whether the injuries aggravated and/or accelerated the degenerative condition.
Section 46(2) of the 1971 Act relevantly provides that where an employee is partially incapacitated for work compensation is payable as to the amount by which the average weekly earnings before injury exceeds the amount per week the employee is able to earn in some suitable employment or business.
In Arnotts Snack Products Pty Ltd v Yacob (1985) 155 CLR 171 the majority approved dicta of Dixon J in Williams v Metropolitan Coal Co. Ltd (1948) 76 CLR 431 at 449 as follows:
It is commonplace that incapacity is not total if some other employment is reasonably open to the injured man. If he is disabled from his former employment, that in itself implies some incapacity. But s.11(1) says that in case of partial incapacity, the weekly payment shall in no case exceed the difference between the amount of his average weekly earnings before the injury and the average weekly amount he is earning or able to earn in some suitable employment or business after the injury. That means that his capacity for other work is taken into account and in such a way that it may reduce the compensation to nothing.

The Full Court went on to say that the incapacity is an incapacity for working in work which the employee was engaged or might reasonably be expected to perform in the labour market with a consequential loss of earning power resulting in economic loss.
As Brennan J explained in his dissenting judgment at page 183 where a partially incapacitated worker earns or is able to earn the amount which the worker would probably have been earning but for the injury is not inconsistent with the existence of partial incapacity. That portion of his Honour's judgment is consistent with the view of the majority.
The issue in the present case is whether the partial incapacity which the applicant suffered caused the applicant to earn less than the applicant's average weekly earnings before the injury.
The answer must be that it did not. The applicant suffered a loss of earnings because he left the Navy on a voluntary discharge. He demonstrated that he was still able to do radio communications work similar to his duties in the Navy after his discharge.
It was the voluntary discharge from the Navy that resulted in loss of earnings. As the applicant demonstrated he was able to continue similar duties and subsequently did so. What he could not manage was the bread run and the cause of that was the shoulder and hernia conditions and subsequent operations.
There is no causative link between the injury in 1975 and the loss of earning capacity. In so far as it is suggested that the 1975 accident accelerated the degenerative lumbar spondylosis we are not satisfied that any such acceleration, if it occurred, had any causative effect upon the overall degeneration which was more than minimal.
Suitable employment for the applicant was provided by the Navy. He resigned from it. He was unable to perform more physically demanding work of bread carting, sand blasting and antenna installation. He was able and did perform work similar to his Naval work. It was the change of work which caused the economic loss, if any. This is not a case such as Asioty v Canberra Abattoir Pty Ltd (1989) 87 ALR 385. The applicant's incapacity for work relates to work of a different type to that in which he was employed by the Navy.

For these reasons the decision under review will be affirmed.
I certify that the 48 preceding paragraphs are a true copy of the reasons for the decision herein of Mr K L Beddoe (Senior Member, Miss A M Brennan AM (Member) and Dr K P Kennedy OBE (Member)
Signed:
  T G Lowther
  Associate
Date/s of Hearing  7 and 8 December 1999
Date of Decision  8 March 2000
Solicitor for Applicant               Mr Justin Crosby – Justin Crosby Solicitors
Counsel for the Respondent    Mr P G Bickford
Solicitor for the Respondent    Mr P Crethary - Barker Gosling Solicitors