McKernan and Comcare
[2004] AATA 1229
•23 November 2004
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2004] AATA 1229
ADMINISTRATIVE APPEALS TRIBUNAL )
) No Q2003/565, Q2003/804
GENERAL ADMINISTRATIVE DIVISION ) Re ROBERT McKERNAN Applicant
And
COMCARE
Respondent
DECISION
Tribunal Ms M J Carstairs, Member Date23 November 2004
Place Brisbane
Decision Q2003/565: The Tribunal sets aside the decision under review and substitutes the decision that the applicant’s compensation payments are to be assessed under s19 of the Safety, Rehabilitation and Compensation Act 1988.
1. Q2003/804: The Tribunal sets aside the decision under review and substitutes the decision that the applicant is entitled to be paid fifty percent of the cost of gymnasium membership as medical treatment under s16 of the Safety, Rehabilitation and Compensation Act 1988 for the period of twelve months from the date of the Tribunal’s decision.
.
The respondent is liable under s67(8) of the Act to pay the applicants’ costs of the applications.
. ......[Sgd]......
M J Carstairs
Member
CATCHWORDS
COMPENSATION – Commonwealth employees – temporal connection between incapacity and retirement –receipt of superannuation – rate of weekly compensation for incapacity for work
COMPENSATION – medical treatment- gymnasium fees
Safety, Rehabilitation and Compensation Act 1988 ss4, 8, 16, 19, 20, 21
Hammerton and Comcare (1995) 21 AAR 204
Re Scott and Commissioner for Superannuation (1986) 9 ALD 491
Re Sullivan and Comcare (1998) AATA 907
Re Keen and Telstra Corporation Ltd [2004] AATA 849
Re Longergan and Repatriation Commission [2004] AATA 659
O’Shea and Comcare (1993) 18 AAR 430
Aboushadi and Telstra Corporation [2004] AATA 35
Telstra Corporation v Aboushadi [2004] FCA 811
Comcare v Watson (1997) 73 FCR 273REASONS FOR DECISION
23 November 2004 Ms MJ Carstairs, Member 2. This is an application by Robert McKernan (the applicant) for review of two reviewable decisions made by delegates of Comcare (the respondent). The first reviewable decision, dated 4 June 2003, in substance affirmed an earlier determination that the applicant’s entitlements to compensation must be calculated under the provisions of s21 of the Safety Rehabilitation and Compensation Act 1988 (the Act), while varying the amounts adopted as normal weekly earnings for purposes of calculating the compensation to be paid to the applicant. The second reviewable decision, dated 11 September 2003, affirmed an earlier determination that the applicant was not entitled to have the cost of a gymnasium program paid as medical treatment under s16 of the Act.
3. At the hearing the applicant was represented by Mr A Harding of counsel instructed by Gilshenan and Luton solicitors. The respondent was represented by Mr Dubé, instructed by the Australian Government Solicitor.
4. The Tribunal had before it the documents lodged under s37 of the Administrative Appeals Tribunal Act 1975, numbered T1–T35 for application Q2003/565 (the first reviewable decision) and T1-T36 for application Q2003/804 (the second reviewable decision) as well as exhibits A1-A7 for the applicant and R1-R4 for the respondent.
BACKGROUND
5. The parties prepared a statement of agreed facts in regard to the first reviewable decision (exhibit A1). The Tribunal accepts the following agreed facts. The applicant was born on 24 November 1944. He obtained employment as a pilot with Australian Airlines an airline company then in operation. The applicant was employed with Australian Airlines and Qantas from January 1971 to 24 August 1989 as a First Officer and Captain.
6. On 1 June 1975 the applicant injured his right knee at work. On 25 September 1975 liability was accepted by Comcare for torn right medial meniscus. The applicant resigned from Australian Airlines on 24 August 1989 during a period of industrial actions by pilots and his resignation was not related to his injury. He was employed with overseas airlines from January 1990 to 27 September 2001. The applicant’s last employment was with PARC Aviation as an airline pilot working twenty days per month from 15 August 2000 until 27 September 2001.
7. The applicant was certified as being totally incapacitated for work as a pilot from 12 December 2001 due to his right knee condition. In January 2002 the applicant lodged a claim for incapacity benefits in relation to his accepted right knee condition.
8. On 2 September 2002 a determination was made that liability was ongoing in relation to the applicant’s right knee claim (T15). Comcare determined that it would pay for periods of incapacity but required further information regarding superannuation and normal weekly earnings from Qantas as well as medical certification before calculations of incapacity entitlements could be made.
9. The applicant was a member of the TAA Pilots Superannuation Fund.(the fund) , which is a superannuation scheme for the purposes of the Act. By letter dated 25 October 2002, the respondent was advised that the applicant exited the fund on 6 October 1989 and elected to receive a lump sum, the Commonwealth funded component of which was $248,944.24. The applicant elected to roll over the whole of his benefit in the fund to the Commonwealth Bank Fund ADF. This election was made on 1 September 1989, with the rollover being processed and paid on 6 October 1989.
10. On 29 October 2002 (T21) Qantas requested a reconsideration of the determination dated 2 September 2002.. On 3 February 2003 a determination was made that the applicant’s incapacity entitlements would be calculated in accordance with s8(4) based on a similar class of employee and under s21 taking into account a lump sum benefit received under a superannuation scheme.
11. On 20 February 2003 the applicant requested a reconsideration of the determination dated 3 February 2003. On 13 March 2003 a reviewable decision affirmed the determination dated 2 September 2002 and determined that:
(a)the applicant was incapacitated for work as an airline pilot as a result of his inability to operate the rudder and brake pedals due to his right knee conditions;
(b)the applicant’s current incapacity for work as an airline pilot was directly related to his osteoarthritis of his right medial compartment of his knee, which was a direct consequence of the applicant’s original injury in 1975;
(c)the applicant was entitled to incapacity benefits from 12 December 2001.
12. On 2 April 2003 (T30) a determination was made to change the description of the applicant’s condition based on medical evidence that the injury sustained by the applicant on 1 June 1975 was a “tear of medial cartilage or meniscus of knee (right)” and further determined that the applicant suffers from a secondary compensable condition, being “osteoarthritis of the right knee”.
13. On 16 April 2003 the applicant requested a reconsideration of the determination dated 3 February 2003 in relation to how his incapacity payments were calculated and he provided details of Normal Weekly Earnings (NWE). On 4 June 2003 the first reviewable decision varied the determination of 3 February 2003 by calculating the applicant’s incapacity entitlements in accordance with the NWE details provided by the applicant. The first reviewable decision found that the applicant’s NWE rate was as follows:-
(a) from 12.12.01 $145,662.75 per annum = $2,792.25 per week
(b) from 1.07.02 $147,119.37 per annum = $2,820.18 per week
14. Having regard to s19(5) of the Act, the first reviewable decision found that the maximum weekly rate payable was 150% of the Average Weekly Earnings of Full Time Adults (AWOTEFA) rather than 75% of the applicant’s NWE. The first reviewable decision found that the applicant’s incapacity payments should have regard to the Commonwealth-funded portion of his superannuation payment and be calculated under s21 of the Act.
15. On 3 July 2003 the applicant lodged an application for review of the first reviewable decision with the Tribunal.
16. On 18 September 2003, the applicant lodged an application for review of the second reviewable decision with the Tribunal. The history of this application was that in 2002 the applicant sought and was granted approval to undertake and continue a gymnasium program (T18, T23: Q2003/804). On 12 June 2003 the applicant sought an extension of the gymnasium program. This request was refused (T33) on the basis that the gymnasium program was not of therapeutic value. This determination was affirmed by the second reviewable decision.
17. The issue for the Tribunal in regard to the first reviewable decision is whether s19 or s21 of the Act applies when calculating the compensation payable to the applicant. The issue in regard to the second reviewable decision is whether the applicant’s gymnasium membership should continue to be paid to him as medical treatment, under s16 of the Act.
EVIDENCE
Q2003/565
18. The parties acknowledged that the question raised by the first reviewable decision concerned the proper interpretation of s19, 20 and 21 of the Act. The parties agreed that the agreed facts provided the basis for that consideration, without additional evidence. Evidence was led in relation to the second reviewable decision.
Q2003/804
19. In a written statement dated 17 August 2004 (exhibit A7) the applicant said that he uses the gymnasium program to strengthen his body in order to minimise reliance on his knee which might otherwise lead to damage, for instance, during tasks such as lifting. He undertakes abdominal muscle exercises and back muscle exercises at the gymnasium for general strengthening. He said that he normally attends the gymnasium 4 to 5 times per week but was unable to attend between 1 October 2002 and 15 February 2003 as he was recovering from knee surgery; between 29 August and 22 September 2003 as he was engaged in a real estate purchase; and between 1 December 2003 and 1 August 2004 due to a shoulder injury. He stated that the gymnasium allowed suspension of membership if necessary.
20. In a report dated 30 July 2002 (T16) Dr I Marshall, general practitioner stated the applicant was undertaking a gymnasium program that had the benefit through exercise, of developing leg musculature to minimise additional knee damage and improve overall muscle tone. He suggested that the exercise routine should continue until 31 July 2003. A letter dated 11 June 2003 (T30) provided by Mr G Cooper, senior exercise physiologist at the gymnasium stated that the applicant had not recently worked on specific knee exercise but had undertaken a general strength program and specific exercises for the hip. In a letter dated 12 June 2002 (but presumably 12 June 2003) (T31) Dr Marshall restated the content of T16, and noted that an exercise routine should continue permanently or until surgical intervention. In a medical certificate dated 22 March 2004 (exhibit A5), Dr Marshall stated that the applicant required continuing gymnasium strengthening exercises as part of his treatment and he stipulated a review date of 30 September 2004.
21. In a report dated 9 December 2003 (exhibit A6), Dr S Geffen, rehabilitation specialist, stated that the applicant should undertake cardiovascular exercise at a minimum of thirty minutes three times per week while avoiding weight bearing. He stated that suitable exercises would include swimming, using an exercise bicycle or doing circuit weights at a gymnasium. He pointed out that weight gain can be a consequence of not exercising and this would be detrimental to the condition of the applicant’s knee.
22. In oral evidence Dr Geffen said that the benefits from exercise include keeping weight in check and strengthening muscles around an arthritic joint, thus reducing excess strain on it. He said also that a fit person tends to be less stressed and will experience less severe symptoms of pain. He recommended a general program, including exercise, Swiss ball, leg machine and bicycle and said that bicycle exercise, while useful, should form part of a program and not be relied upon entirely because cycling puts pressure through the knee.
CONSIDERATION OF THE ISSUES
Q2003/565
23. The parties agree that the figures used by Comcare when calculating the applicant’s normal weekly earnings are correct, only the method of calculation is in dispute. The point for determination by the Tribunal is whether s19 or s21 applies, and in particular whether s21 can apply if the person’s incapacity commences after their retirement.
24. Section 19 of the Act provides:
(1)This section applies to an employee who is incapacitated for work as a result of an injury, other than an employee to whom section 20, 21, 21A or 22 applies.
25. Section 21 of the Act provides:
(1)This section applies to an employee who, being incapacitated for work as a result of an injury retires voluntarily, or is compulsorily retired, from his or her employment at any time after the commencement of this section and, as a result of the retirement, receives a lump sum benefit under a superannuation scheme.
(2)Comcare is liable to pay compensation to the employee, in respect of the injury, in accordance with this section for each week after the date of the retirement during which the employee is incapacitated.
26. Both parties agreed that this issue had been looked at by the Tribunal in Re Hammerton and Comcare (1995) 21 AAR 204. In that case the Tribunal said:
Looking at the words of sub-sections 20(1) and 21(1), it seems to me that neither is providing that there must be a causative link between the incapacity for work as a result of an injury and retirement. Rather, they are providing only a temporal link between the incapacity and the retirement. The retirement comes after the incapacity and may be either compulsory or voluntary retirement. The only causative link in the two provisions is between the retirement and the receipt of a pension under a superannuation scheme. The receipt of the pension must be received because of the retirement. This interpretation of the words of sub-sections 20(1) and 21(1) is consistent with the words of section 19 which sets out the benchmark, as it were, for employees who are incapacitated as a result of an injury but does not relate to those who are provided for by sub-sections 20 and 21.
27. Mr Harding acknowledged that these remarks were not the basis of the decision in Hammerton, but he also relied also on the Tribunal’s decision in Re Sullivan and Comcare (1998) AATA 907 which agreed with Hammerton that the Act contemplates consideration of whether there is a temporal connection between incapacity and retirement. Mr Dubé submitted that there was no clearly binding authority because Hammerton did not need to address the question directly. Mr Dubé said that the Tribunal should take into account that the Second Reading Speech introducing the superannuation provisions (s20, 21 and 21A of the Act) made clear that the section was to prevent the receipt of superannuation and incapacity payments at the same time. He urged the Tribunal to look at the purpose of the Act as a whole and take account of the references made by the Tribunal in Hammerton and in O’Shea and Comcare (1993) 18 AAR 430 to the importance of avoiding double dipping through the receipt of compensation and superannuation at the same time.
28. The Tribunal notes that Re Hammerton has been followed by the Tribunal in Re Sullivan; Re Keen and Telstra Corporation Ltd [2004] AATA 849; Re Longergan and Repatriation Commission [2004] AATA 659 and Aboushadi and Telstra Corporation [2004] AATA 35. There is some force to the argument urged on behalf of the respondent that the line of authority is inconsistent with the policy intentions of the legislation. However the Tribunal accepts Mr Harding’s submission that when the Federal Court has had the opportunity to look at the question generally in Telstra Corporation Ltd v Aboushadi [2004] FCA 811 the Court made no adverse comment about the Tribunal’s reasoning in Aboushadi when applying Hammerton.
29. The course suggested by Mr Dubé, of departing from a settled line of authority should not be undertaken lightly. The question of the Tribunal following its own decisions was addressed by the Tribunal in Re Scott and Commissioner for Superannuation (1986) 9 ALD 491 at 499:
One effect of the Tribunal's decisions is to establish administrative norms; they enable legislation to be administered consistently. For the Tribunal to make decisions inconsistent with its own previous decisions adversely affects that process. Doubtless, in some instances, where a matter has been decided by the Tribunal without full argument or full consideration and it is necessary for the Tribunal in later proceedings to examine the matter fully, it may then properly reach a conclusion different from the previous decision. In that event, because the later decision is the first made upon a full consideration of the matter, it is clear to administrators that that decision should be followed rather than the previous decision…..Nevertheless, where a matter has been decided by the Tribunal after full consideration of competing arguments, the decision is one which is reasonably tenable and there have been no changes to the legislation and no new decisions of the High Court of Australia or the Federal Court which may be relevant, it seems to us that it would be extremely unhelpful for the Tribunal in subsequent proceedings to decide the matter in a manner inconsistent with that decision, particularly when the arguments advanced are substantially the same as those advanced in the previous case.
30. The Tribunal was not persuaded to depart from the line of reasoning in Hammerton which has been consistently applied. This means that the decision made by the respondent to assess the applicant’s entitlements under the compensation provisions by applying s21 rather than s19 was incorrect. Applying the reasoning in Hammerton, the applicant became incapacitated for work after he left employment with Australian Airlines in 1989. He therefore is entitled to have his benefits assessed under s19 of the Act because s19 applies where s21, which requires that the person be incapacitated for work prior to retirement and not after retirement, does not. It is undisputed in this case that the applicant’s incapacity for work post-dated his retirement from Australian Airlines.
Q2003/804
31. Section 16 of the Act provides for the payment of s16 as follows:
Where an employee suffers an injury, Comcare is liable to pay, in respect of the cost of medical treatment obtained in relation to the injury (being treatment that it was reasonable for the employee to obtain in the circumstances), compensation of such amount as Comcare determines is appropriate to that medical treatment.
"Medical treatment" is defined in s4 to mean (inter alia):
(b) therapeutic treatment obtained at the direction of a legally qualified medical practitioner;
"Therapeutic treatment" in turn is defined in the same section as including:
an examination, test or analysis done for the purpose of diagnosing, or treatment given for the purpose of alleviating, an injury.
32. Mr Harding submitted that Comcare v Watson (1997) 73 FCR 273 established that the test under s16 requires affirmative answers to the question “is the program therapeutic?” and “is it at the direction of a medical practitioner?” He submitted that Dr Geffen’s evidence supported a recommendation to undertake a gymnasium program and Dr Marshall consistently recommended the gymnasium program as of therapeutic value.
33. Mr Dubé agreed that the Federal Court decision in Watson applies. He submitted that the Tribunal could not be satisfied that Dr Marshall was directing the applicant attend the gymnasium, so much as the applicant sought this course and the doctor agreed. Mr Dubé submitted that it was not reasonable that Comcare bear the full costs of a gymnasium program where other alternatives, equally suitable on Dr Geffen’s evidence, were less costly. He submitted that the Tribunal should decide if granting the claim that it should be limited to the cost of an exercise bicycle and Swiss ball. .
34. The Tribunal accepts that the evidence suggests that the appropriate therapeutic treatment of the applicant’s knee could be obtained through other programs that specifically target the compensable condition, that is, through the use of a Swiss ball, and exercise bicycle, in combination with swimming. It is undoubtedly true, as Dr Geffen asserted in his evidence, that there are general benefits to be gained by anyone through exercise, and this view is evident in reports signed by Dr Marshall. However, Dr Marshall as the treating doctor is the one who has repeatedly directed that the applicant undertake a gymnasium program. Whether or not Dr Marshall simply signed the documents at T16 and T31, he has been prepared to adopt their contents, and has independently restated his support for the gymnasium program by certification dated 22 March 2004 (exhibit A5).
35. The Tribunal was satisfied that the gymnasium program undertaken in the past with the approval of Comcare and requested again in 2003 was therapeutic treatment obtained at the direction of a legally qualified medical practitioner and that it qualifies as medical treatment under s16 of the Act.
36. However, in the Tribunal’s view, the respondent’s liabilities are not unlimited and should be confined to treatment that relates directly to the injury. As the Federal Court said in Watson:
…therapeutic treatment in this setting is a purposive activity – ie its purpose or object must be the treatment of the particular injury in question. If such is not the actual, specified purpose of the activity the notwithstanding its beneficial effects, it will not relevantly be therapeutic treatment for present purposes.
37. The Tribunal accepts the evidence of Dr Geffen and Dr Marshall that the gymnasium program has general health benefits as well as benefits that relate specifically to the compensable injury. The Tribunal considers that Comcare should not be liable for the more general benefits that are to be gained by a person’s attendance at the gymnasium. In addition to the requirement that the treatment must be relevant to the specific injury, s16 of the Act encompasses notions of reasonableness, in the reference to treatment that it was reasonable for the employee to obtain in the circumstances and in the reference to what amount is appropriate to be paid for medical treatment.
38. The Tribunal took into account that Dr Marshall has recommended in the past that the gymnasium program be reviewed from time to time and this accords with common sense, particularly where the evidence is that the applicant has had to let his membership lapse due to other injuries and after surgery to his knee. It is important that an active program such as gymnasium membership continues to be monitored for its appropriateness by the applicant’s treating doctor, and to decide whether it continues to be of therapeutic value. For these reasons the Tribunal concludes that the applicant was not entitled to the total cost of a gymnasium program as medical treatment under s16 of the Act but is entitled to be paid half gymnasium membership fees for a period of twelve months to enable his progress to be reviewed.
DECISION
39. Q2003/565: The Tribunal sets aside the decision under review and substitutes the decision that the applicant’s compensation payments are to be assessed under s19 of the Safety, Rehabilitation and Compensation Act 1988.
40. Q2003/804: The Tribunal sets aside the decision under review and substitutes the decision that the applicant is entitled to be paid fifty percent of the cost of gymnasium membership as medical treatment under s16 of the Safety, Rehabilitation and Compensation Act 1988 for the period of twelve months from the date of the Tribunal’s decision.
I certify that the preceding forty paragraphs are a true copy of the reasons for the decision of M J Carstairs, Member
Signed: Camille Banks
Associate
Date of Hearing 19 August 2004
Date of Decision 23 November 2004
Counsel for the Applicant Mr A Harding
Solicitor for the Applicant Gilshenan and Luton
Counsel for the Respondent Mr B DubèSolicitor for the Respondent Australian Government Solicitor
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