McGrath v Nestle Australia Ltd - [2012] NSWWCCPD 3

WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:		McGrath v Nestle Australia Ltd [2012] NSWWCCPD 3
APPELLANT:		Maria Louise McGrath
RESPONDENT:		Nestle Australia Ltd
INSURER:		Employers Mutual Indemnity (Workers Compensation) Limited
FILE NUMBER:		A1-4444/11
ARBITRATOR:	Mr John Wright
DATE OF ARBITRATOR’S DECISION:		19 September 2011
DATE OF APPEAL DECISION:		18 January 2012
SUBJECT MATTER OF DECISION:		Incapacity; erroneous finding of partial incapacity; failure by the Arbitrator to take into account evidence relevant to matter in dispute; correction of error on appeal.
PRESIDENTIAL MEMBER:		Deputy President Kevin O'Grady
HEARING:		On the papers
REPRESENTATION:		Appellant:	Steve Masselos & Co
Respondent:	Edwards Michael Lawyers
ORDERS MADE ON APPEAL:		1. Paragraph 2 of the Arbitrator’s decision made in Certificate of Determination dated 19 September 2011 is revoked and the following orders made in its place: “2. Award for the applicant in respect of total incapacity as follows: (a) $813 per week from 4 August 2010 to 2 February 2011 pursuant to s 36 of the Workers Compensation Act 1987; (b) $516.90 per week as adjusted from 3 February 2011 to date and continuing calculated in respect of entitlement of a worker with a dependent spouse, pursuant to s 37 of the Workers Compensation Act 1987.” 2. Paragraphs 1, 3, 4 and 5 of the Arbitrator’s decision are confirmed. 3. The respondent is to pay the appellant’s costs of this appeal.

BACKGROUND TO THE APPEAL

Mrs Maria Louise McGrath, the appellant, commenced proceedings against her former employer, Nestle Australia Ltd (the respondent) which were heard by Arbitrator John Wright on 11 August 2011. Mrs McGrath established in those proceedings that she had suffered a psychiatric injury in the course of her employment as an area manager by reason of bullying, harassment, inappropriate behaviour and progressive intimidation inflicted upon her by her direct supervisor between January 2010 and August 2010.
Mrs McGrath had commenced employment with the respondent in March 1990. She ceased work by reason of incapacity following her injury on 4 August 2010. A claim made by her seeking workers compensation benefits was declined by the respondent’s insurer on an unknown date (the first s 74 notice). Notice of the insurer’s denial of the claim was again given to Mrs McGrath in correspondence dated 4 November 2010. That correspondence constituted an amended notice issued pursuant to s 74 of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act). The second s 74 notice stated that the insurer placed reliance upon ss 4, 9A, 11A, 33 and 60 of the Workers Compensation Act 1987 (the 1987 Act). That denial of liability was elaborated in a further amended notice (dated 17 June 2011) which is addressed in greater detail at [28] below. When the Application to Resolve a Dispute came before the Arbitrator on 11 August 2011 the issues in dispute included a denial of injury; a defence by the respondent alleging that any psychological injury proven had been caused by reasonable action taken…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading McGrath v Nestle Australia Ltd

Details

AGLC: McGrath v Nestle Australia Ltd [2012] NSWWCCPD 3
Case: [2012] NSWWCCPD 3
Decision Date: 18 January 2012

CaseChat Overview and Summary

The case of McGrath v Nestle Australia Ltd was heard in the Court of Appeal. The dispute concerned a workers' compensation claim brought by Mrs McGrath against Nestle Australia Ltd, her employer. Mrs McGrath claimed she suffered a psychological injury that rendered her totally incapacitated for work. The employer denied liability for her claim on the basis that her injury was not caused by the employment, or if it was, that it was wholly or predominantly caused by reasonable actions taken by the employer. The employer also argued that the compensation rate claimed by Mrs McGrath was excessive.

The legal issues before the court included the interpretation of the relevant provisions of the Workers Compensation Act 1987, the determination of whether Mrs McGrath's injury was work-related, and the correct weekly compensation rate. The court had to consider the evidence provided by both parties and assess whether the Arbitrator's findings were supported by the evidence.

The Court of Appeal found that the Arbitrator had erred in his findings on the extent of Mrs McGrath's incapacity. The court held that the Arbitrator failed to take into account relevant evidence and made an erroneous finding of partial incapacity. The court corrected the error by awarding total incapacity benefits and setting the appropriate compensation rate. The court emphasised that the Arbitrator should have considered all relevant evidence, including the WorkCover certificates issued by Dr Lee, which supported a finding of total incapacity. The court also determined that the compensation rate should be adjusted based on Mrs McGrath's pre-injury earnings and her status as a dependent spouse.

The court made specific orders to correct the Arbitrator's decision. It revoked the previous award of partial incapacity and instead awarded total incapacity benefits. Mrs McGrath was awarded $813 per week from 4 August 2010 to 2 February 2011 and $516.90 per week from 3 February 2011, adjusted for her status as a dependent spouse. The court also confirmed other paragraphs of the Arbitrator's decision and ordered the respondent to pay the appellant's costs of the appeal.

Orders

Orders of the court

1. Paragraph 2 of the Arbitrator’s decision made in Certificate of Determination dated 19 September 2011 is revoked and the following orders made in its place:

“2. Award for the applicant in respect of total incapacity as follows:

(a) $813 per week from 4 August 2010 to 2 February 2011 pursuant to s 36 of the Workers Compensation Act 1987;

(b) $516.90 per week as adjusted from 3 February 2011 to date and continuing calculated in respect of entitlement of a worker with a dependent spouse, pursuant to s 37 of the Workers Compensation Act 1987.”

2. Paragraphs 1, 3, 4 and 5 of the Arbitrator’s decision are confirmed.

3. The respondent is to pay the appellant’s costs of this appeal.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

The “further amended” s 74 notice referred to at [2] and [25] above included the following matters:“Reason(s) for the DecisionLiability for your claim for weekly compensation and medical treatment expenses is denied on the basis that you have not suffered a psychological injury within the meaning of the Act or, alternatively, that any psychological injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by or on behalf of the insured with respect to performance appraisal or discipline. Further, and in the alternative, we say that the Section 36 rate claimed by you is excessive.This decision is made in accordance with Sections 4, 11A, 33, 36 and 60 of the Workers Compensation Act 1987Issues relevant to the decisionThis decision is made based on the evidence of Dr Roberts that you were upset by some circumstances of your employment with the insured and on the basis that emotional upset does not constitute “injury” within the meaning of the Act. In the alternative, we rely on the fact that despite concerns in relation to your interpersonal relationships with Mr Erickson, no issues were raised by you with anyone in authority between 17 February 2010 and a meeting on 29 July 2010 at which your performance was discussed. We rely on factual evidence that a performance improvement plan was issued in November 2009 concerning your area of operations and factual evidence that discrepancies had arisen in relation to an audit which included areas of your responsibility. We say that the meeting was a reasonable response to issues which had come to the attention of the insured and that all actions in relation to the meeting were reasonable and related to performance appraisal or, alternatively, action taken or proposed to be taken in relation to discipline. Finally, we say that the correct Section 36 rate should be $813.60 per week.” Counsel appearing on behalf of the respondent, following argument concerning the question of proof of injury and the establishment of a defence pursuant to s 11A, proceeded to deal with the question of proof of incapacity. In summary it was put that any entitlement to weekly compensation would be in respect of a closed period, that is, that Mrs McGrath had no ongoing entitlement to compensation benefits. The evidence of Dr Roberts was relied upon in support of that submission. An alternative argument was put that, upon the basis that ongoing incapacity was found, Mrs McGrath should be found to have “a substantial residual earning capacity”. Counsel appearing on behalf of Mrs McGrath placed reliance upon the WorkCover certificates issued by Dr Lee in support of an argument that there should be a finding of total incapacity. Counsel further argued that, should a finding be made of partial incapacity, Mrs McGrath’s entitlement “given her pre-injury earnings of $1,010 [per week]” would be to a “full award”. That entitlement, it was argued, was in respect of the “full statutory rate with one dependant being her husband”.

Ratio Decidendi

Legal Principle Established

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