McVey v GJ and LJ Smith Pty Ltd

[2014] VSC 236

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

JUDICIAL REVIEW AND APPEALS LIST

S CI 2013 04775

WILLIAM McVEY (A person under a disability who brings this proceeding by his Litigation Guardian ANTHONY BULLARD)	Plaintiff
v
GJ & LJ SMITH PTY LTD & ORS	Defendants

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JUDGE:	GARDE J
WHERE HELD:	Melbourne
DATE OF HEARING:	8 April 2014
DATE OF JUDGMENT:	21 May 2014 (Revised on 21 May 2014)
CASE MAY BE CITED AS:	McVey v GJ & LJ Smith Pty Ltd
MEDIUM NEUTRAL CITATION:	[2014] VSC 236

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ACCIDENT COMPENSATION – Medical Panel – Previous medical panel – Assessment of psychiatric impairment resulting from accepted psychiatric schizophrenia injury at 0% –  Whether wrong in law or open to medical panel – Accident Compensation Act 1985 (Vic), ss 67(1) and (1A), 68(4), 82(1), 91(1) and (1A), 91(7)(c), 98C(1) and 104B.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr G Uren QC with Mr A Ingram	Melbourne Injury Lawyers Pty Ltd
For the First Defendant	Mr M Fleming QC with Mr R Kumar	Thomson Geer
For the Second and Third Defendants	No appearance

HIS HONOUR:

Introduction

1. The plaintiff (‘Mr McVey’) by his litigation guardian (‘litigation guardian’) sues his former employer, and the members of the medical panel (‘medical panel’) that on 15 July 2013 certified his level of psychiatric impairment resulting from an accepted psychiatric injury at 0% under s 91 of the Accident Compensation Act 1985 (Vic) (‘the Act’). Mr McVey sustained an injury in the course of his employment as a truck driver with the first named defendant (‘the employer’). On 30 April 1999 he was checking the engine of a truck and raised the hood covering the engine. A gust of wind caused the hood to strike him (‘the incident’).

1. Mr McVey suffers from schizophrenia, and permanent psychiatric impairment as a consequence of this illness.

1. Mr McVey seeks to have the certificate of opinion, and the reasons for opinion of the medical panel quashed by the Court for error of law. In substance, two errors of law are alleged. The first is that the medical panel did not assess his accepted psychiatric condition in accordance with s 91 of the Act. He says that the medical panel was wrong when it considered that his schizophrenia was an injury or cause unrelated to his accepted injury. He says that it was not open to the medical panel, having assessed his degree of whole person impairment from his accepted schizophrenic condition at 35%, to form the opinion that there was a 0% psychiatric impairment resulting from the accepted psychiatric schizophrenia condition when assessed in accordance with s 91 of the Act.

1. The second error of law argued on behalf of Mr McVey was the failure of the medical panel to adopt, apply and accept as final and conclusive the opinion of a prior medical panel given on 11 February 2007 (‘previous medical panel’). In essence, it is said that the medical panel was required under s 68(4) of the Act to conclude that Mr McVey was suffering from schizophrenia relevant to the alleged psychiatric injury, and that his employment was a significant contributing factor to that condition.

Factual background

1. On 30 April 1999, in the course of his work with the employer Mr McVey was injured when he was checking the engine of a Kenworth truck and for that purpose had raised the fibreglass hood covering the engine. A gust of wind caused the hood to descend striking him heavily on the neck and left shoulder girdle. The occurrence and character of the incident are not disputed.  

1. On 31 May 1999, Mr McVey submitted a claim for compensation in respect of physical injuries to the “left shoulder, left muscles inflammation (sic), left side of neck and head”. Liability for that claim was accepted, as was a further claim for compensation dated 1 September 2000 for permanent disability and physical injuries to the “back, both arms, neck and both legs”.

1. Following a referral from His Honour Judge Coish of the County Court of Victoria pursuant to s 45(1)(b) of the Act, the previous medical panel certified on 11 February 2007 that:

Question 1.

What is the nature of the Plaintiff’s medical condition relevant to any injury, or alleged injury, to his neck, back, left shoulder and head and/or psychiatric injury (“the said injuries”)?

Answer:

The Panel is of the opinion the Plaintiff is not now suffering from any physical medical condition of the left shoulder relevant to the said injuries.

The Panel is also of the opinion that the Plaintiff is suffering from schizophrenia, relevant to the said injuries.

The Panel is also of the opinion that there is no medical condition of the neck, back or head relevant to the said injuries.

Question 2. 

Was the Plaintiff’s employment in fact a significant contributing factor to any, and if so which, of the said injuries?

Answer:

The Panel is of the opinion the Plaintiff’s employment was in fact a significant contributing factor to a now resolved soft tissue injury of the left shoulder and the schizophrenia condition.

Question 3.

Does the Plaintiff have:
(a) a current work capacity; or
(b) no current work capacity;

as a result of any, and if so which, of the said injuries?

Answer:

(a)  No.

(b) The Panel is of the opinion the Plaintiff has no current work capacity as a result of the schizophrenia condition.

Question 4.

If the Plaintiff has no work capacity, is he likely to continue indefinitely to have no current work capacity?

Answer: 

Yes

Question 5.

If the Plaintiff has no work capacity which is likely to continue indefinitely, does the incapacity result from or is it still materially contributed to by any, and if so, which of the said injuries?

Answer: 

The Panel is of the opinion the Plaintiff’s incapacity for work results from and is still materially contributed to by the psychiatric injury.

1. The reasons for decision of the previous medical panel also dated 11 February 2007 state:  

The Panel considers that the Plaintiff probably has had psychological problems for many years but the Panel considers that the incident in 1999 has contributed to his psychiatric deterioration and his psychiatric treatment has largely commenced since the incident in 1999. The Panel considers that the Plaintiff did suffer from some physical injuries which have impacted upon his psychological state and helped bring about the manifestation of much of his psychiatric symptomatology.

The Panel concluded that the Plaintiff is suffering from schizophrenia. 

1. By order made on 21 March 2007, Judge Coish ordered the employer to make weekly payments of compensation at the rate appropriate for no current work capacity from 10 April 2004 and continuing, as well as past payments of compensation including an amount of $15,000 to be held by the litigation guardian.

1. On 1 September 2008, Mr McVey through his litigation guardian submitted an impairment benefits claim (‘impairment benefits claim’) under s 98C of the Act in respect of “psychiatric injury including schizophrenia condition, back, both arms, neck and both legs”.

1. The claim for impairment benefits provided injury details as follows:

3.FOR WHAT INJURY/CONDITION(S) ARE YOU CLAIMING IMPAIRMENT BENEFITS?

…

Psychiatric injury, including schizophrenia condition, back, both arms, neck + both legs.

4.      WHAT BODY PARTS ARE AFFECTED?

…

Psychiatric injury including schizophrenia condition, back, arms neck, legs.

…

6.DATE INJURY SUSTAINED OR DATE YOU FIRST BECAME AWARE OF THE CONDITION

30/4/99

7.      HOW DID YOUR INJURY/CONDITION(S) OCCUR?

The 30-4-99 incident (hood of truck hitting L shoulder) contributed to psychiatric deterioration + caused manifestation of symptomology.

1. The answer to question 7 made it clear that the incident was claimed to have “contributed to psychiatric deterioration and caused manifestation of symptomology”. It was a claim for exacerbation or aggravation of a pre-existing condition. It was admitted and never in doubt that there was a schizophrenia condition predating the injury.

1. The impairment benefits claim was rejected for the reason that there had been a previous claim submitted in reliance upon s 104B(5A) and (5AA) of the Act. Mr McVey commenced a proceeding in the County Court. That proceeding was dismissed. Ultimately, the Court of Appeal allowed an appeal from the dismissal of the County Court proceeding, and ordered among other things that the defendants in that proceeding assess the impairment benefits claim in accordance with law.[1] The basis of the decision of the Court of Appeal was that Mr McVey lacked mental capacity at the time when he purported to submit the claim under s 98C of the Act on 31 May 1999 with the result that the submission of the impairment benefits claim at a later time did not infringe s 104B(5A) and (5AA) of the Act.[2]

   [1]McVey v G J & L J Smith Pty Ltd [2012] VSCA 312.

   [2]Ibid [4(b)-(e)] (Maxwell P and Tate JA), [61] (Davies AJA).

1. On 13 March 2013, Dr Steven Adlard (‘Dr Adlard’), consulting psychiatrist was instructed to undertake a psychiatric assessment of Mr McVey and provide a report. The instructions stated:

This worker has claimed non-economic loss pursuant to Section 98C of the Accident Compensation Act 1985 (‘the Act’), in respect of a mental disorder/illness, which occurred on 30.4.1999.

Liability has been accepted and this examination is for assessment of this worker’s permanent impairment only.

1. Dr Adlard interviewed Mr McVey on 20 March 2013. He was of the opinion that Mr McVey had “long-standing chronic Schizophrenia which appears to have been unresponsive to treatment”. He concluded that the condition “clearly predated the workplace incident in April 1999”.

1. As to the specific questions asked of him, Dr Adlard responded:

a)i)      What is the nature of the mental disorder/illness?

Mr McVey has chronic Schizophrenia.

I note that you have accepted liability for this condition, presumably on the basis of the Medial Panel report from 2007 and possibly from other IMEs. Based on what Mr McVey told me he had psychotic symptoms and probably schizophrenia 16 years prior to the workplace injury (and longer according to his GP). Also from what he told me, he had a patchy work history prior to 1999 with one year off work in 1982, three years off work from 1985-1988, further time off work when he attended Bible school in 1990-1 and had further psychotic symptoms, and he left a number of companies in the 1990s for various reasons. He has worked less since the workplace injury in 1999 though I note that he has completed a number of courses and he said he stopped work not because of psychiatric symptoms but because of physical symptoms.

I am not convinced (though as I said, I have limited information) from my interview with Mr McVey that the workplace injury in 1999 has had any significant impact on his psychiatric condition. If there was any temporary hiccup in his schizophrenic condition from the physical injury in 1999, which I am not sure of, it has long since gone. The trajectory of his condition is consistent with the natural history of chronic treatment resistant Schizophrenia. Keep in mind that he appears to have had significant psychotic symptoms as far back as 1983 and they were very severe by the sound of it between 1989 and 1992.

…

iv)Please confirm how the [Diagnostic and Statistical Manual of Mental Disorders] DSM-IV diagnostic criterion has been satisfied.

Mr McVey meets the criteria for chronic Schizophrenia in that he has had many years of auditory hallucinations, delusions, and he presents with disorganized speech and inappropriate affect. There has been an effect on social and occupational functioning and the condition has lasted for more than six months.

…

b)        Has the impairment stabilised?

Yes. This condition appears to have been present for about 30 years and is unlikely to change.

…

d)Please provide an assessment of whole person psychiatric impairment, using the enclosed Evaluation of Psychiatric Impairment Record.

The Evaluation of Psychiatric Impairment Record is enclosed. Mr McVey has a total whole person impairment of 35%; this is in my opinion unrelated to the incident in April 1999, and as such his whole person impairment under S.91 (2) of the Act is 0%.

1. Dr Adlard concluded that Mr McVey had suffered from psychotic symptoms and probably schizophrenia from as far aback at 1983 and longer according to his general practitioner. He considered that the psychotic symptoms were “very severe by the sound of it between 1989 and 1992”. He was also not convinced that the workplace injury in 1999 had any significant impact on his psychiatric condition expressing the opinion concerning the workplace injury that “If there was any temporary hiccup in his schizophrenic condition from the physical injury in 1999, which I am not sure of, it has long since gone”.

1. Dr Adlard assessed Mr McVey as having a total whole person impairment of 35% - all unrelated to the incident. As a result, he concluded that the whole person impairment under s 91(2) of the Act was 0%.

1. On 27 March 2013, Mr McVey was advised by letter of the result of his impairment benefits claim. The letter stated:

Liability decision

In accordance with sections 91, 98C, 98E and 104B of the Accident Compensation Act 1985 (the Act), Allianz Australia Workers’ Compensation (Victoria) Limited has reviewed your claim and determined liability for the injuries you have listed as work-related on your Worker’s Claim for Impairment Benefits Form. 

Liability is accepted for the following injuries:

·PSYCHIATRIC INJURY – SCHIZOPHRENIA

Liability is rejected for the following injuries:

·N/A

…

Assessment of impairment determination

Allianz Australia Ltd has determined the degree of whole person impairment after taking into account the assessments provided by the Independent Impairment Assessors.

Your psychiatric whole person impairment has been determined at 0%

…

Psychiatric Impairment

Under section 98C of the Act, an impairment benefit is only payable if your degree of permanent psychiatric impairment is 30% or greater and not secondary to a physical injury. As your degree of psychiatric impairment is less than 30%, you do not have an entitlement to an impairment benefit.

1. On 1 May 2013, the impairment benefits claim was referred to the medical panel under s 104B(9)of the Act. The referral stated:

4. ACCEPTED INJURIES TO BE ASSESSED BY THE MEDICAL PANEL

(A)      Psychiatric injury – Schizophrenia

…

6.ISSUES AND REASON FOR REFERRAL

(a)William McVey lodged a s98C/E claim for psychiatric injury (schizophrenia)

(b)Liability was accepted for psychiatric injury – Schizophrenia

…

(d)Court Outcome for the rejected injuries was that liability was accepted for psychiatric – Schizophrenia injury

(e)William McVey was examined by Dr S Adlard who assessed the following psychiatric condition – schizophrenia.

(f)William McVey has:

-       Disputed the psychiatric assessment.

…

9.MEDICAL QUESTIONS

(i) What is the worker’s degree of permanent whole person impairment resulting from the accepted injury/s as assessed in accordance with S91 and is the impairment permanent?

(ii) Does the worker have an accepted injury, which has resulted in a total loss injury mentioned in the table in S98E(1)?

1. The medical panel provided a certificate of opinion in response to the two questions asked of it and reasons for opinion both dated 15 July 2013. The certificate stated:

…

Question i)

What is the worker’s degree of permanent whole person impairment resulting from the accepted injury/s as assessed in accordance with S91 and is the impairment permanent?

Answer:

The Panel is of the opinion that there is a 0% psychiatric impairment resulting from the accepted psychiatric, schizophrenia injury when assessed in accordance with Section 91 of the Act. The degree of psychiatric impairment is permanent within the meaning of the Act.

Question ii)

Does the worker have an accepted injury, which has resulted in a total loss injury mentioned in the table in S98E(1)?

Answer:

No. 

1. The two questions asked of the medical panel were materially different from the five questions asked of the previous medical panel in 2007. The reasons given by the medical panel in July 2013 include the following opinions and conclusions:

…

The Panel concluded that the worker suffered from an exacerbation of a pre-existing Chronic Schizophrenia, and that the exacerbation of this condition has since resolved, relevant to the accepted psychiatric – schizophrenia injuries.

The Panel is therefore of the opinion that the entirety of the current psychiatric condition results from the worker’s pre-existing Chronic Schizophrenia.

The Panel considers that due to the chronic nature of the worker’s psychiatric injury and the duration of the symptoms, the worker’s psychiatric condition has substantially stabilised and is unlikely to remit with further treatment.

The Panel therefore concluded that for the purposes of the assessment, the worker’s psychiatric condition is stable and permanent.

…

In the Panel’s opinion the median class is 3 and the degree of psychiatric impairment is 35%, and all of this psychiatric impairment is due to the worker’s pre-existing chronic schizophrenia and is therefore excluded from the psychiatric impairment assessment in accordance with Section 91(7)(c) of the Act. The Panel considers the degree of impairment is permanent.

The Panel therefore concluded that there is a 0% psychiatric impairment resulting from the accepted psychiatric, schizophrenia injury when assessed in accordance with Section 91 of the Act. The degree of psychiatric impairment is permanent within the meaning of the Act.

The Panel noted the report of independent medical examiner Dr S Adlard dated 20 March 2013, in which he concluded that the worker was suffering from ‘chronic Schizophrenia’ and had a total psychiatric impairment of 35%, all of which was preceding and unrelated to the relevant workplace incident. The Panel noted that Dr Adlard documented clear psychotic phenomena dating from 1983 and on this basis concluded that the Schizophrenic illness predated the relevant workplace incidents by many years.

The Panel came to a  similar conclusion with respect to the diagnosis and to a similar conclusion regarding the level of impairment, based upon its own history taking, mental status examination and clinical judgment. The Panel came to a different conclusion regarding an exacerbation and subsequent resolution of the exacerbation of the Schizophrenic illness, for reasons as detailed in the relevant paragraphs above.

…

The Panel assessed the accepted psychiatric schizophrenia injury in accordance with Section 98E of the Act and concluded that there is no total loss or total loss of use injury when assessed pursuant to Section 98E of the Act.

1. The reasoning of the medical panel may be summarised:

(a)Mr McVey suffered from an exacerbation of a pre-existing chronic schizophrenia;

(b)the exacerbation of this condition had since resolved relevant to the accepted psychiatric injury;

(c)the entirety of the current psychiatric condition resulted from the pre-existing chronic schizophrenia;

(d)the psychiatric condition had substantially stabilised and was unlikely to remit for further treatment;

(e)the psychiatric condition was stable and permanent;

(f)the degree of psychiatric impairment was 35% and was permanent;

(g)all of the psychiatric impairment was due to the pre-existing chronic schizophrenia;

(h)all of the psychiatric impairment must be excluded from the psychiatric impairment assessment in accordance with s 91(7)(c) of the Act; and

(i)as a result, there was a 0% psychiatric impairment resulting from the accepted psychiatric schizophrenia injury when assessed in accordance with s 91 of the Act.

1. The fundamental issue in this proceeding is whether it was open to the medical panel to exclude all of the psychiatric schizophrenia impairment from the psychiatric impairment assessment under s 91(7)(c) of the Act arriving at a 0% psychiatric impairment resulting from the accepted psychiatric schizophrenia injury.

Statutory framework

1. Section 67(1) and (1A) of the Act set out the function of a medical panel and require a medical panel to give its opinion on a medical question in accordance with Division 3 of Part III of the Act. They provide:

(1)The function of a Medical Panel is to give its opinion on any medical question in respect of injuries arising out of, or in the course of or due to the nature of employment before, on or after the commencement of section 10 of the Accident Compensation (WorkCover) Act 1992 referred by a Conciliation Officer or the County Court or the Authority or a self-insurer.

(1A)A Medical Panel must give its opinion on a medical question in accordance with this Division.

1. Section 68(4) of the Act gives the opinion of a medical panel final and conclusive effect. It provides:

   For the purposes of determining any question or matter, the opinion of a Medical Panel on a medical question referred to the Medical Panel is to be adopted and applied by any court, body or person and must be accepted as final and conclusive by any court, body or person irrespective of who referred the medical question to the Medical Panel or when the medical question was referred.

2. Section 68(4) has recently been considered by the High Court of Australia in Wingfoot Australia Partners Pty Ltd v Kocak,[3] having previously been considered by the High Court of Australia in Maurice Blackburn Cashman v Brown,[4] and by the Court of Appeal in Pope v WS Walker & Sons Pty Ltd.[5] In Kocak, the High Court said:[6]

The Court of Appeal reached its conclusion that the County Court would be compelled by s 68(4) of the Act to adopt and apply the opinion of the medical panel because it considered itself bound by the reasoning in the first of those quoted passages in Brown to hold that an opinion of a medical panel on a medical question referred to it must thereafter be adopted and applied for the purposes of determining all questions or matters arising under or for the purposes of the Act. An earlier decision of the Court of Appeal, Pope v WS Walker & Sons Pty Ltd, is to the contrary. The correctness of Pope was not in issue in Brown, and is supported in the present appeal by both the employer and the worker. The Court of Appeal’s reasoning in Pope highlights the potential for injustice in the outworking of the construction to which the Court of Appeal felt compelled, as well as the lack of support for that construction in legislative history. The passage in Brown should not be interpreted as having overruled Pope.

The correct construction of s 68(4) of the Act, consistent with Pope and with Brown, is to read the word “any” in the introductory expression “[f]or the purposes of determining any question or matter” as referring to “a question or matter” not “all questions and matters”. In respect of a particular opinion of a medical panel on a medical question referred to it, formed under s 68(1) and certified under s 68(2), the question or matter to which s 68(4) refers is the question or matter in which the medical question arose and in respect of which the medical question was referred to the medical panel.

What s 68(4) of the Act on that construction requires is that an opinion of a medical panel on a medical question referred to it must thereafter be adopted and applied for the purposes of determining the question or matter, arising under or for the purposes of the Act, in which the medical question arose and in respect of which the medical question was referred to the medical panel. What s 68(4) does not require is that the opinion must thereafter be adopted and applied for the purposes of determining some other question or matter.

The operation of s 68(4) of the Act in the present case was therefore to require the opinion given by the medical panel on the medical questions referred to it in the statutory compensation application to be adopted and applied by all courts and persons in the determination of the question or matter the subject of the statutory compensation application. That question or matter comprised the controversy between the parties to the statutory compensation application about the worker’s entitlement to the statutory compensation he claimed under Pt IV of the Act, and was brought to a conclusion when the statutory compensation application was dismissed. Section 68(4) did not have, and does not have, the further effect of requiring the opinion given on the medical questions referred in the statutory compensation application to be adopted and applied if and to the extent that the same medical question may arise in the determination of the question or matter the subject of the serious injury application. That quite distinct question or matter, which remains unresolved, comprises the controversy between the parties to that application as to whether the worker should have leave to bring common law proceedings.

[3](2013) 303 ALR 64 (‘Kocak’).

[4](2011) 242 CLR 647.

[5](2006) 14 VR 435 (‘Pope’).

[6]Kocak (2013) 303 ALR 64, 75 [35]–[38] (French CJ, Crennan, Bell, Gageler and Keane JJ) (footnotes omitted).

1. In Pope, Eames JA, with whom Neave JA and Bell AJA agreed, said:[7]

Although the breadth of medical question (i) would be such as to encompass any questions on the topics set out in the existing paragraphs of the definition in s 5 of “medical question”, the fact that power to refer questions under the existing paragraphs was expressly granted as well as additional power under paras (h) and (i) does not indicate that Parliament treated an opinion obtained for the purpose of a statutory benefits dispute as being of equal relevance to the hearing of a s 134AB application.

Before 2000 all of the existing medical questions from paras (a)-(g) could have been referred by the Court to a medical panel with respect as to a dispute about statutory benefits, pursuant to the power under s 45(1), and it was statutory benefits claims with which s 68(4) was concerned. Thus, what is made clear by s 45(1A) is that the Court now has power to refer all such medical questions (that is those under paras (a)-(g)) for the purpose of its hearing of a s 134AB application, but, in addition, exclusive power is given to pose medical questions under paras (h) and (i). Thus, the Court hearing proceedings under s 134AB is given power which is no less, and is indeed greater, than that given to courts, bodies or persons concerned with statutory benefits disputes.

The opening words of s 68(4) are: “For the purposes of determining any question or matter, the opinion of a Medical Panel on a medical question referred to the Medical panel ... ”. In my view, the word “any” cannot be interpreted literally, because to do so would give the provision unlimited operation, which could not have been intended. The provision is intended to give binding effect to the opinions of medical panels “on a medical question referred” and, as discussed above, the Act gives power to refer a medical question in quite specific contexts, one of which is with respect to proceedings under s 134AB(16)(b). Thus, it is natural to link the question or matter upon which the opinion is binding to the proceeding from which the question was referred. That then focuses attention on the nature of the proceedings in which the opinion was obtained. Section 68(4) goes on to state that the opinion must be “adopted and applied by any court, body or person”, which means that the opinion is binding on all persons who have a role to play in proceedings of that nature. So construed, an opinion on a medical question referred in a proceeding concerning statutory benefits would not be binding on a court concerned with an application under s 134AB(16)(b).

The legislative scheme is, however, consistent with the conclusion that if a Court hearing a s 134AB application refers any of the questions from paras (a)-(i) to a medical panel, then it will be bound by the (final and conclusive) answer which is given (subject, of course, to consideration of such matters as the express terms of the question and answer and of the relevance and applicability of the opinion to the issues being addressed).

[7]Pope (2006) 14 VR 435, 444 [35]-[38].

1. Section 82(1) of the Act is the central provision in the scheme of the Act:

If there is caused to a worker an injury arising out of or in the course of any employment, the worker shall be entitled to compensation in accordance with this Act.

1. Assessment of degree of impairment is undertaken in accordance with s 91(1)(a) and (1A) of the Act:

(1)In this Part, a reference to the assessment of a degree of impairment in accordance with this section is a reference to an assessment—

(a)made in accordance with—

(i) the A.M.A Guides as applicable subject to subsections (1A) and (1B); or

(ia)the A.M.A Guides as applicable subject to subsections (1A) and (1B) and guidelines in accordance with subsection (6), (6A) or (6B); or

(ii)methods prescribed for the purposes of this section—

and in accordance with operational guidelines (if any) as to the use of those Guides or methods issued by the Minister; and

…

(1A)Despite anything to the contrary in the A.M.A Guides, an assessment under subsection (1) of the degree of impairment resulting from an injury must be made—

(a)after the injury has stabilised; and

(b)subject to subsection (7), based on the worker's current impairment as at the date of the assessment, including any changes in the signs and symptoms following any medical or surgical treatment undergone by the worker in respect of the injury.

1. Section 91(1A) is significant in the present case for it provides for the assessment of the degree of impairment resulting from an injury to be made after the injury has stabilised and on the basis of the worker’s current impairment as at the date of the assessment. This includes any changes in the symptoms following treatment in respect of the injury. Section 91(1A)(b) is read subject to s 91(7).

1. Section 91(7)(c) is the pivotal provision in the current proceeding. It provides:

(7) For the purposes of section 98C—

…

(c) impairments from unrelated injuries or causes are to be disregarded in making an assessment;

…

1. The interpretation of s 91(7)(c) has been considered in previous decisions of this Court. In Millane v M J Millane Pty Ltd, Balmford J said:[8]

The assessment is to be “in accordance with section 91” and section 91(7)(c) requires that “impairments from unrelated injuries or causes are to be disregarded in making an assessment”. The question is, “unrelated to what?” It would appear to me that that provision is concerned with injuries or causes which are unrelated to the injury the results of which are being assessed; that is, the injury in respect of which the claim was made. The logic of that provision is thus that compensation, in respect of a particular claim under section 98C, is, by virtue of section 91(7)(c), to be paid only in respect of the results of the employment out of or in the course of which the injury sought to be compensated arose and which was a significant contributing factor to that injury, in terms of section 82(1). In particular, I can see no other meaning to be given to the expression “impairments from unrelated causes”. The cause of an impairment must be related to that impairment. The expression cannot be intended to mean “causes of an impairment which are unrelated to that impairment”. Nor can it be intended to mean “causes of an impairment of the worker which are unrelated to the worker”. The applicant’s previous history of psychiatric illness was related to the applicant and related to her psychiatric condition, but was not related to the injury of 12 February 1999. Thus, in making the assessment of the results of the 1999 injury in terms of the degree of the applicant’s impairment, any impairment resulting from that previous history is to be disregarded.

[8][2003] VSC 72 [11].

1. As a result, Balmford J held:[9]

Accordingly, I find that it was open to the Panel, on the material before it, and applying the relevant statutory provisions, to find, as it did, that the applicant’s degree of psychiatric impairment was 50%, but that only 20% of that impairment resulted from the injury of 12 February 1999 in respect of which the claim was made.

…

[9]Ibid [14].

1. Likewise, in Vegco Pty Ltd v Gibbons,[10] Kyrou J said as to s 91(7)(c) of the Act in the context of a subsequent injury which exacerbated the compensable injury, the subject of the claim:

Section 91(7)(c) of the AC Act contains a clear legislative direction to medical panels to disregard impairments from unrelated injuries or causes in making their assessment. It follows that if a medical panel takes into account an impairment from unrelated injuries or causes in making its assessment, it will have taken into account a consideration it is bound not to take into account.

…

Section 91(7)(c) of the AC Act required the medical panel to disregard any impairment to Mr Gibbs from unrelated injuries or causes. Any aggravation to the injuries sustained by Mr Gibbs from his employment with Vegco arising from his subsequent employment in Broome constituted an impairment from unrelated injuries or causes within the meaning of s 91(7)(c). It is clear from the medical panel’s reasons that it did not disregard the impairment Mr Gibbs suffered from the unrelated Broome injury in making its assessment and that it considered that impairment as material. It thus failed to comply with s 91(7)(c) of the AC Act. In failing to disregard such impairment, the panel took into account a consideration it was bound to ignore and therefore made a jurisdictional error.

[10][2008] VSC 363 [17] and [21].

1. J Forrest J followed and applied these decisions in Alcoa Holdings Ltd v Lowthian.[11] His Honour said:[12]

The second and correct meaning, in my view, is that, in making an impairment assessment, any impairment from an unrelated injury or cause is disregarded so as to ensure that the impairment assessment relates solely to that resulting from the compensable injury.

…

Both these decisions demonstrate that the statutory command to the Panel is to evaluate only the impairment related to the compensable injury and to put to one side any impairment produced by non-related injuries or causes. Accordingly, if the evidence establishes a pre-existing impairment from an unrelated injury or cause, then the Panel is obliged to consider that impairment and to ensure its estimate of the current impairment disregards any pre-existing impairment (or for that matter, any subsequent impairment flowing from an unrelated injury or cause).

…

The Act, however, does not permit any discretionary evaluation. The previous impairment from an unrelated injury or cause must be disregarded. Nor does the Act insist upon the historical information and previously compiled medical data being “verified as being accurate”. Rather, it obliges the Panel to evaluate the unrelated impairment on the material presented to it.

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. If the evidence enables it to determine the extent of the present impairment and that of the pre-existing impairment, then it must make allowance for the pre-existing impairment.

[11][2011] VSC 245 [60]-[66].

[12]Ibid [60], [66], [72] and [73] (footnote omitted).

1. Section 91(7) is expressed to take effect “for the purposes of section 98C”. Section 98C(1) provides:

A worker who suffers an injury which entitled the worker to compensation is, in respect of an injury resulting in permanent impairment as assessed in accordance with section 91, entitled to compensation for non-economic loss calculated in accordance with this section.

1. Section 104B also applies to claims for compensation, and describes the procedure to be adopted under s 98C. In part, it provides:

(1)In addition to the requirements under section 103, this section applies to a claim for compensation under section 98C.

…

(2)The Authority or self-insurer must within 120 days of receiving a claim made by the worker or in the case of a claim initiated by the Authority or self-insurer, within 120 days of the relevant date—

(a)if the claim is a claim made by the worker, accept or reject liability for each injury included in the claim;

(b)obtain an assessment or assessments in accordance with section 91 as to the degree of permanent impairment (if any) of the worker resulting from the injury or injuries in respect of which liability is accepted;

(c)after taking into account the assessment or assessments obtained under paragraph (b), determine the degree of permanent impairment (if any) of the worker for each of the purposes of—

(i)section 98C;

(ii)section 134AB;

(iii)Subdivision 1 of Division 3A;

…

(2A)The Authority or self-insurer is not bound by the assessment or assessments obtained under subsection (2)(b) in determining the degree of permanent impairment (if any) under subsection (2)(c).

…

(9)The Authority or self-insurer must, within 14 days of being advised by the worker that the worker disputes the determinations of impairment or total loss in respect of the injury or injuries claimed, refer the medical questions as to—

(a)the degree of impairment assessed in accordance with section 91 resulting from the injury or injuries claimed for which liability is accepted or established; and

(b)whether the worker has an injury or injuries claimed for which liability is accepted or established which is a total loss mentioned in the Table in Schedule 3B—

to a Medical Panel for its opinion under section 67.

Analysis

1. Mr Uren QC who appeared with Mr Ingram for Mr McVey had two main arguments about the medical panel’s certificate of opinion and reasons. First, he said that the panel was wrong when it considered that it was bound under s 91(7)(c) of the Act to disregard Mr McVey’s psychiatric schizophrenic condition from which he was suffering when he made his claim in 2008. Secondly, Mr Uren QC contended that the medical panel treated the accepted psychiatric injury to mean something other than the injury stated in the claim. Having accepted liability for the condition, and having accepted injury in the terms of the questions asked of the panel, it was not open to the panel to look further at the cause of the accepted injury. Rather, he said that the panel was obliged to take liability as having been accepted for the schizophrenia and should have assessed the agreed impairment of the condition it was asked to assess.

1. I do not accept these arguments. They conflate the steps required under s 104B(2) of the Act. Under s 104B(2)(a), the first step is for the insurer to accept or reject liability for each injury included in the claim. Here the claim was necessarily a claim for exacerbation or aggravation of chronic schizophrenia, as that condition and psychotic symptoms long preceded the date of the incident on 30 April 1999. This is evident from the impairment benefits claim form completed by the litigation guardian which stated that the incident on 30 April 1999 “contributed to psychiatric deterioration and caused manifestation of symptomology” as well as from the undisputed expert opinions of Dr Adlard and the medical panel.

1. However, acceptance of liability, or for that matter rejection of liability for each injury included in the claim is only the completion of the first step in the process directed by s 104B(2).

1. The second step under s 104B(2)(b) is to obtain an assessment “in accordance with section 91” as to the degree of permanent impairment (if any) of the worker resulting from the injury or injuries in respect of which liability is accepted. Two points may immediately be made. First, the second or assessment step must be made in accordance with s 91. This requires adherence to all of s 91 including s 91(7) in assessing the degree of permanent impairment resulting from the injury or injuries in respect of which liability is accepted. Secondly, the use of the words “if any” expressed in parentheses in s 104B(2)(b) make it clear that the legislature considered that there could be a situation where liability in respect of an injury might be accepted by an insurer in respect of a worker, but that the degree of permanent impairment might be assessed as zero per cent. This is unsurprising as there will inevitably be many situations where an injury is sustained but no permanent impairment results.

1. The third and last relevant step for present purposes required by s 104B(2)(c) is for the insurer to take into account the assessment or assessments made under paragraph (b) to determine the degree of permanent impairment (if any) of the worker for purposes including the purposes of s 98C. As I have noted, s 98C(1) itself requires assessment in accordance with s 91 of any injury resulting in permanent impairment.

1. It has been held in three decisions of this Court,[13] that in making an impairment assessment, any impairment from an unrelated injury or cause is disregarded so as to ensure that the impairment assessment relates solely to the impairment resulting from the compensable injury. If the evidence establishes that there is a pre-existing impairment from an unrelated injury or cause, a medical panel is obliged to consider that impairment and to ensure its estimate of the current impairment disregards the pre-existing impairment flowing from the unrelated injury or cause. This form of evaluation is mandated by s 91(7)(c) of the Act. A medical panel is not at liberty to disregard this requirement.

   [13]Millane v M J Millane [2003] VSC 72 [11], Vegco Pty Ltd v Gibbons [2003] VSC 363 [17] and [21], Alcoa Holdings Ltd v Lowthian [2011] VSC 245 [60], [66], [72] and [73].

1. In my opinion, the medical panel carried out its work in accordance with the requirements of the Act. It is evident that it carefully considered the extent of psychiatric impairment disagreeing in one respect from the opinion previously expressed by Dr Adlard. The medical panel accepted that Mr McVey had suffered from an exacerbation of his pre-existing chronic schizophrenia, but that the exacerbation of this condition had since been resolved. This conclusion inevitably led to the opinion that the entirety of the current psychiatric condition resulted from Mr McVey’s pre-existing chronic schizophrenia. This conclusion is not in any way inconsistent with the conduct of an impairment assessment for psychiatric impairment resulting in a degree of psychiatric impairment of 35% all of which was attributable to Mr McVey’s pre-existing chronic schizophrenia. The panel rightly decided that the pre-existing chronic schizophrenia was required to be disregarded under s 91(7)(c) of the Act.

1. Further, as Mr Fleming QC and Mr Kumar who appeared for the employer submitted the acceptance of liability for an injury suffered as a consequence of an incident on 30 April 1999 does not constitute any acceptance of liability or admission that the injury was ongoing or productive of any current impairment. Dr Adlard was of the opinion that if there had been a temporary hiccup in Mr McVey’s schizophrenic condition, it had passed. Dr Adlard assessed Mr McVey’s psychiatric impairment at 35%, all of which was unrelated to the incident on 30 April 1999. The medical panel was of similar view to Dr Adlard, although it was satisfied that there had in fact been an exacerbation of pre-existing chronic schizophrenia caused by the 1999 incident which had since resolved. The medical panel disregarded its assessment of 35% as the degree of psychiatric impairment for the same reason as Dr Adlard namely that it was bound by s 91(7)(c) of the Act to do so.

Previous medical panel opinion

1. The argument advanced on behalf of Mr McVey based on s 68(4) of the Act must also fail. As the High Court held in Kocak,[14] the opinion of the previous medical panel must be adopted and applied for the purposes of determining the question or matter in which the medical question arose and in respect of which the medical question was referred to the medical panel. However, it does not require the opinion of the medical panel to be adopted for the purposes of determining some other question or matter. The two questions asked of the medical panel were substantially different from those asked of the previous medical panel, and were asked as to a much later date.

   [14]See [27] above.

1. The medical panel undertook its examination in July 2013. The previous medical panel conducted its examination in 2007. It is not surprising that over six years later the medical panel reached the conclusion that it did that while there had been an exacerbation or aggravation of the pre-existing chronic schizophrenia caused by the incident in April 1999 that exacerbation or aggravation had since resolved. The conclusion reached by the medical panel is not inconsistent with the opinion of the previous medical panel given as it was in 2007.

1. It was open to the medical panel to take the view that the aggravation in 1999 was a transient or passing or past aggravation that had no current impairing consequences. It was also open to the medical panel to take the view that once the aggravation had passed the continuing chronic schizophrenia was due to Mr McVey’s pre-existing condition prior to the aggravation incident. These matters were properly before the panel. As an expert panel, it was open to it to be of the opinion that the current permanent psychiatric impairment was due only to Mr McVey’s pre-existing schizophrenic condition, and not as to the whole or any part due to the aggravation in 1999. The medical panel had the opinion of the previous medical panel as well as the opinion of Dr Adlard before it. It was open to it to come to the opinion which it did. It did not act contrary to the requirements of s 68(4) of the Act.

Conclusion

1. I am of the opinion that the medical panel did all that it was required by the Act to do. There was nothing legally wrong in what it did. The panel took into account the considerations that it was obliged to take into account and gave effect to s 91(7)(c) as required by the Act and three decisions of this Court.

1. There was no error of law by the medical panel.

1. None of the grounds set out in the originating motion have been sustained. The proceeding must be dismissed.