Murphy v Kalianna Enterprises Incorporated
[2006] NSWWCCPD 35
•2 March 2006
WORKERS COMPENSATION COMMISSION
APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:Murphy v Kalianna Enterprises Incorporated [2006] NSWWCCPD 35
APPELLANT: Noel William Murphy
RESPONDENT: Kalianna Enterprises Incorporated
INSURER:Employers Mutual Indemnity (Workers Compensation) Ltd
FILE NUMBER: WCC16284-03
DATE OF ARBITRATOR’S DECISION: 7 July 2004
DATE OF APPEAL DECISION: 2 March 2006
SUBJECT MATTER OF DECISION: Whether work was a substantial contributing factor pursuant to section 9A of the Workers Compensation Act 1987; discretion of the Arbitrator and whether the relevant case law was properly applied.
PRESIDENTIAL MEMBER: Acting Deputy President Mary Walker
HEARING:On the Papers
REPRESENTATION: Appellant: Nevin Lenne & Gross
Respondent: Arnold Lawyers
ORDERS MADE ON APPEAL: Leave to appeal against the decision of the Arbitrator is granted.
The decision of the Arbitrator dated 7 July 2004 is confirmed.
No order as to the costs of the appeal.
BACKGROUND TO THE APPEAL
On 23 July 2004 Noel William Murphy (‘the Appellant Worker’) sought leave to bring an ‘Appeal Against Decision of Arbitrator’ in the Workers Compensation Commission (‘the Commission’) against a decision, dated 7 July 2004.
The Respondent to the Appeal is Kalianna Enterprises Incorporated (‘the Respondent Employer’).
The Appellant Worker’s claim is that he suffered injuries to his left and right hips. The Appellant Worker alleges that these injuries arose out of the nature and conditions of his employment and coincided with an injury to his back which occurred on 22 February 2003.
The Appellant Worker claims medical and related expenses incurred as a result of the injuries sustained pursuant to section 60 of the Workers Compensation Act 1987 (‘the 1987 Act’).
The issues in dispute in relation to the claim for medical expenses before the Arbitrator were:
“•Did the Applicant receive an injury arising out of or in the course of employment? (the 1987 Act)
•Was the Applicant’s employment a substantial contributing factor to his injury? (the 1987 Act)
•Are some or all of the Applicant’s medical and related expenses incurred as a result of treatment, services or assistance that was reasonably necessary for the compensable injury (the 1987 Act section 60).”
A Certificate of Determination and attached Statement of Reasons were issued by the Workers Compensation Commission on 7 July 2004 and set out the decision of the Arbitrator as follows:
“1.The Respondent Employer is not liable for the payment of the Applicant’s claim under s 60 of the Workers Compensation Act, 1987.
2. That each party pay its own costs.”
The Appellant Worker seeks leave to appeal in order to have the decision of the Arbitrator revoked.
SUBMISSIONS ON LEAVE AND FRESH EVIDENCE
The Appellant Worker submits the amount of compensation at issue in this appeal “is at least $15,000.00”. Further, the Appellant Worker seeks leave to rely on new evidence. The Appellant Worker seeks leave to rely on the report of Dr D. Conroy dated 20 July 2004 to establish that the cost of bilateral hip replacement surgery required by the Appellant Worker is more than $5,000.00.
The Respondent Employer submits:
“On the substantive issue of whether the Application satisfies section 352(2) of the Act the Respondent notes that the Orders sought are that proposed surgery falls under the heading of ‘medical or related treatment’ and being ‘reasonably necessary’ as a result of an injury received by the Worker.
Whilst the Respondent accepts that the Commission can make such a determination, the Commission has no power to make what appears to be the further Order sought by the Applicant being that the Respondent should pay a sum estimated as being over $5,000.00 at sometime in the future for treatment which is yet to have occurred.
It is therefore the Respondent’s submission that the amount of compensation sought in the Appeal is not at least $5,000.00 and as such the Commission should not grant leave as requested.”
ON THE PAPERS REVIEW
The Appellant Worker, in submissions filed on 23 July 2004, stated that he “does not object to the matter of leave to appeal being decided solely on the basis of the written application and notice of opposition.” In submissions dated 28 July 2004 the Respondent Employer consented to all matters on appeal being determined on the papers.
On 19 January 2006 the following directions were made:
“1.The Appellant Worker is invited to make further written submissions in this matter and to file them with the Commission and serve them on the Respondent Employer on or before 30 January 2006 as to why this appeal cannot be determined on the papers pursuant to section 354(6) of the 1998 Act.
2.The Appellant Worker is invited to make any further submissions in relation to the substantive issues and to file them with the Commission and serve them on the Respondent Employer on or before 30 January 2006.
3.The Respondent Employer may make any further submissions in relation to the substantive issues on appeal or in reply to 2 and file them with the Commission and serve them on the Appellant on or before 6 February 2006.”
On 30 January 2006 an extension was sought by the Appellant Worker’s solicitors to file further submissions for a further seven days. The Commission informed the parties on 9 February 2006 that the application for an extension made by the Appellant Worker was granted.
In submissions filed on 23 July 2004 the Appellant Worker objected to the appeal being dealt with solely on the basis of:
“… written application and any written notice of opposition of the following grounds:
a. the reason for the appeal concerns a complex area of law,
b. the appeal is of significant public interest,
c.further issues in relation to the original application may require submissions and determination,
d.the grounds of the appeal require argument and consequently further submissions.”
The Respondent submitted on 28 July 2004 that “…should leave to appeal be granted to the Applicant there is no valid reason it cannot be done on the papers and the previous submissions more than adequately canvass the relevant issues that formed the basis of the decision being appealed against.”
Further submissions on behalf of the Appellant Worker dated 30 January 2006 were filed and the following was submitted:
“From the judgment of the Arbitrator it is quite clear that he had a fundamental misunderstanding of the Disease Provisions of the Workers’ Compensation Act. The provisions are complex and have been the subject of much judicial interpretation. It is submitted that there would be a complete lack of procedural fairness if the worker was not able to articulate his case.”
No further submissions relating to the substantive issues on appeal were filed on behalf of the Appellant Worker and the solicitors on behalf of the Respondent did not file any further submissions in reply.
The Commission is permitted to determine appeals on the papers where it is appropriate. Sections 354(1) and (6) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) provide:
“(1)Proceedings in any matter before the Commission are to be conducted with as little formality and technicality as the proper consideration of the matter permits ….
(6)If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”
Having regard to Practice Direction Numbers 1 and 6, and having carefully read all of the documents that are before me, and the submissions filed by both the Appellant Worker and Respondent Employer, I am satisfied that I have sufficient information to proceed in determining this appeal, ‘on the papers’, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances. I do not consider the issues raised in this appeal to be so complex that they are not capable of adequate elucidation by written submission. Each party has made written submissions and has been provided adequate opportunity to submit additional or further submissions. Each of the parties has referred to relevant authorities in those submissions.
FRESH EVIDENCE
The Appellant Worker seeks to rely upon new evidence, being the report of Dr D. Conroy dated 20 July 2004, to establish that the cost of bilateral hip replacement surgery is more than $5,000.00.
The report of Dr Conroy dated 20 July 2004 provides an estimate of the cost of a proposed bilateral hip replacement procedure as follows:-
“My estimate of the total cost including hospital and operating room fees for a stay of at least 10 days, physiotherapy fees for supervision of rehabilitation for three months, surgeons, anaesthetists, radiologists and pathologists fees, and the cost of the prosthesis is $12,500 to $15,000.”
The Respondent Employer is silent in its submissions in respect to the Appellant Worker’s application for admission of Dr Conroy’s report in this appeal.
‘Fresh evidence’ on appeal is governed by section 352(6) of the 1998 Act, which provides as follows:
“(6) Evidence that is fresh evidence or evidence in addition to or in substitution for the evidence received in relation to the decision appealed against may not be given on an appeal to the Commission except with the leave of the Commission.”
Practice Direction No. 6 sets out the process for seeking leave of the Commission to give ‘new evidence’ on appeal. It provides as follows:
“New Evidence
Where a party seeks leave to give new evidence in relation to the decision appealed against, that party must serve a copy of the new evidence on the other parties to the dispute when serving the Application or Opposition.
In general, the Commission will allow new evidence to be introduced only where it can be demonstrated that the new evidence could not reasonably have been obtained by the party and tendered in proceedings before the Arbitrator and that failure to allow the new evidence would cause a substantial injustice in the circumstances of the individual case.”
The application of section 352(6) of the 1998 Act has been considered by the Commission in Ross v Zurich Workers Compensation Insurance [2002] NSW WCC PD 7 (citing CDJ v VAJ [1998] HCA 67); Ian Sheridan v David Clarke t/as Freestyle Marine Sports [2003] NSW WCC PD 4 (‘Ian Sheridan’); Mitchell v NSW Department of Community Services [2004] NSW WCC PD 2; Rohloff v Diacut Pty Ltd [2005] NSW WCC PD 17; and Meltons Fertilisers Pty Ltd v Eddy [2005] NSW WCC PD 31.
In Raisebore Pty Limited v Brendyn Wilson [2003] NSW WCC PD 40, at page 9, Deputy President Byron summarised the application of section 352(6) of the 1998 Act as follows:
“The admission of new or fresh evidence in an appeal has been considered by the Commission in a number of appeals: (cf. Christopher Michael McMahon v Anthony Lagana and Joseph Lavella t/as the Vessel “Nimble II” [2003] NSW WCC PD 22; Shipman Pty Ltd v Matters [2003] NSW WCC PD 19, and Ross v Zurich Workers Compensation Insurance [2002] NSW WCC PD 7). In summary, the factors that weigh in favour of the exercise of a discretion to admit fresh evidence in an appeal include the following:
•if the request is refused, a substantial injustice will result to the party who seeks to have the evidence admitted: Radnedge v Government Insurance Office of NSW (1987) 9 NSWLR 235;
•the evidence could not have been discovered, with reasonable diligence, at the time of the original proceedings: Radnedge v Government Insurance Office of NSW (supra); Glover v Australian Ultra Concrete Floors Pty Ltd [2003] NSWCA 80, and
•the evidence is of such probative value that there is a high degree of probability that it would lead to a different outcome in the case: Greater Wollongong City Council v Cowan (1955) 93 CLR 435; Warr v Santos [1973] 1 NSWLR 432; Harrison v Schipp (2002) 54 NSWLR 738, and Akins v National Australia Bank (1994) 34 NSWLR 155.”
Deputy President Dr Fleming in Christopher Michael McMahon v Anthony Lagana and Joseph Lavella t/as the Vessel “Nimble II” [2003] NSW WCC PD 22 at page 4 outlined the factors weighing against the exercise of the discretion to admit fresh evidence:
“•the interest in the finality of litigation and the importance of the ability of the successful party to rely on the outcome of the proceedings, Litynski v Albion Steel Pty Ltd (1994) 10 NSWCCR 287,
•the prejudice, if any, that may result to the other party, particularly if the fresh evidence raises new arguments in the appeal, and
•the intention of the legislative scheme in relation to the nature of the proceedings.”
No objection has been raised in respect of the admission of the report of Dr Conroy dated 20 July 2004 by the Respondent Employer. No prejudice has been cited by the Respondent Employer in the event that the report of Dr Conroy was to be admitted.
At all material times the Respondent Employer was insured by Employer Mutual Indemnity (Workers Compensation) Limited (“EMI”) and by letter to the Appellant Worker dated 5 September 2003 EMI denied liability for the Appellant Worker’s bilateral hip replacement surgery. By at least 5 September 2003, prior to the matter being heard before the Arbitrator, the Respondent Employer was on notice of the issue, the subject of this appeal.
Medical Evidence, cited before the Arbitrator raising the issue of the Appellant Worker’s hip condition and proposed bilateral hip replacement surgery included:
•Reports of Mr Michael Long, General Surgeon, dated 19 August 2002 x 2, 25 October 2002
•Reports of Dr James Bodel, Orthopaedic Surgeon, dated 30 January 2003, 19 March 2003
• Statement of Noel William Murphy dated 3 July 2003
•Report of Mr David Kirwan, Hip and Knee Specialist, dated 20 August 2002, 14 October 2002, 30 October 2002
•Report of Ms Karen Evans, Rehabilitation Consultant – Occupational Therapy, dated 4 June 2003
•Reports of Mr Terence Hillier, Orthopaedic Surgeon, dated 22 April 2002, 16 July 2002, 26 August 2002, 30 September 2002, 16 December 2002, 24 February 2003,
• Letter Mr Noel Murphy to EMI dated 13 October 2002
• Letter EMI to Mr Noel Murphy dated 18 October 2002
• Letter EMI to Dr David Kirwan dated 9 September 2002
• Letter Dr David Kirwan to Mr Hillier dated 20 August 2002
• Medical Imaging Report of Dr V Thomas dated 9 April 2002
•Medical Assessment Certificate of Mr Warwick Huntsdale (date of examination of the Appellant Worker 5 April 2004).
Clearly the issue of future medical expenses including the proposed bilateral hip replacement was in issue before the Arbitrator and the Respondent Employer has had ample opportunity to assess the medical issues and proposed cost of future medical expenses. No prejudice to the Respondent Employer is evident.
In the Arbitrator’s Statement of Reasons at page 4, (7 July 2004) the Arbitrator stated that: “[t]here is no specific evidence of the expenses claimed as they are in the futuro.” To avoid injustice to the Appellant Worker and having regard to the probative value of the report as the only indication of the cost of the proposed future surgery in evidence in this matter, and after considering the factors noted above I admit the report of Dr Conroy dated 20 July 2004 for consideration in the Appellant Worker’s application for leave.
LEAVE
Before proceeding to deal with an appeal the Commission must determine whether the application meets the requirements of section 352 of the 1998 Act, which provides:
“352 Appeal against decision of Commission constituted by Arbitrator
(1)A party to a dispute in connection with a claim for compensation may, with leave of the Commission constituted by a Presidential member, appeal to the Commission as so constituted against a decision in respect of the dispute by the Commission constituted by an Arbitrator.
(2)The Commission is not to grant leave to appeal unless the amount of compensation at issue on the appeal is both:
(a)at least $5,000 (or such other amount as may be prescribed by the regulations), and
(b) at least 20% of the amount awarded in the decision appealed against.
(3)If the Commission refuses to grant leave to appeal, the Commission must state reasons for the refusal in writing to the parties.
(4)An appeal can only be made within 28 days after the making of the decision appealed against.
(5)An appeal under this section is to be by way of review of the decision appealed against.
(6)Evidence that is fresh evidence or evidence in addition to or in substitution for the evidence received in relation to the decision appealed against may not be given on an appeal to the Commission except with the leave of the Commission.
(7)On appeal, the decision may be confirmed or may be revoked and a new decision made in its place.
Alternatively, the matter may be remitted back to the Arbitrator concerned, or to another Arbitrator, for determination in accordance with any decision or directions of the Commission.
(8)In this section, decision includes an award, interim award, order, determination, ruling and direction.”
The appeal was lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act.
The issue raised by the Respondent Employer for consideration in respect to the Appellant Worker’s application for leave is that, as no amount was awarded in the decision appealed against and no amount is capable of being awarded pursuant to section 60 of the 1987 Act as the amount sought by the Appellant Worker has not yet been incurred, section 352(2) of the 1998 Act has no application. Also, as no award was made for the cost of future surgery the $5,000.00 threshold required by section 352(2) of the 1998 Act has not been met. Accordingly, the Respondent Employer submits that leave to appeal should be refused.
The Application of the threshold requirements of section 352(2)(a) and (b) of the 1998 Act has been considered by the Commission in Mawson v Fletcher International Exports Pty Limited [2002] NSW WCC PD 5; ADCO Constructions Pty Ltd v Ferguson [2003] NSW WCC PD 21; Ingram v Norco Co-Operative Limited [2003] NSW WCC PD 1; Sheridan v Coles Supermarkets Australia Pty Limited [2003] NSW WCC PD 3 (‘Sheridan’); Tagg v International Flavours and Fragrances (Australia) Ltd [2003] NSW WCC PD 5; Workcover Authority v Riordan [2003] NSW WCC PD 13 and in Grimson v Integral Energy [2003] NSW WCC PD 29.
I agree with the interpretation of section 352 as noted in the decision of Deputy President Dr Fleming in Ian Sheridan at page 4 as follows:
“I do not accept the submission that where the Applicant does not succeed in gaining any award there can be no grant of leave. Section 352 refers to ‘the amount of compensation at issue on the appeal’. Whilst section 352(1) [sic] (a) and (b) are clearly cumulative, there is no place for the application of subsection (b) where an award has not been made (see the comments of Deputy President Byron in Mawson v Fletchers International Exports Pty Limited [2002] NSW WCC PD 5). Where a party has been partially unsuccessful before an Arbitrator, to the extent that they dispute at least 20% of the amount awarded by the Arbitrator in the decision, and the amount at issue in the appeal is at least $5000.00, then the threshold test for the grant of leave to appeal is also met. This ensures that in addition to the threshold of $5000.00, appeals that dispute less than 20% of the amount awarded are not allowed, while at the same time, appeals that dispute an award of nil are allowed. While the wording of section 352 (2) lacks clarity and may benefit from review, the intention is to limit appeals in relation to amounts that are only a small proportion of the amount awarded by the Arbitrator.”
Additional clarity is found in the decision of Fletchers International Exports Pty Ltd v Regan [2004] NSW WCC PD 7 (‘Fletchers International’) where no amount of compensation was awarded in the decision appealed against. In Fletchers International at page 4 Deputy President Dr Fleming interpreted section 352 of the 1998 Act as follows:
“While a decision of an Arbitrator may not concern an ‘award’ of compensation (as in Mawson), the appeal must nonetheless affect an “amount of compensation at issue on the appeal” to pass the threshold test in section 352(2)(b). Purely procedural decisions, such as a decision to adjourn a telephone conference (Tagg v International Flavours and Fragrances (Australia) Ltd [2003] NSW WCC PD 5), a decision in relation to costs only (Grimson v Integral Energy [2003] NSW WCC PD 29), and a decision to schedule a further telephone conference (Falcon v Narellan Enterprises Pty Limited [2003] NSW WCC PD 34) do not meet this threshold criterion. The decision must have a real capacity to put the amount of compensation, determined by reference to the decision or the claim (Sheridan v Coles Supermarkets Australia Pty Limited [2003] NSW WCC PD 3), in issue in the appeal …”.
The Arbitrator’s decision the subject of this appeal concerns the application of section 60 of the 1987 Act.
Section 60 of the 1987 Act in part, provides that:
“60 Compensation for cost of medical or hospital treatment and rehabilitation etc
(1)If, as a result of an injury received by a worker, it is reasonably necessary that:
(a)any medical or related treatment (other than domestic assistance) be given, or
(b) any hospital treatment be given, or
(c) any ambulance service be provided, or
(d) any occupational rehabilitation service be provided,
the worker’s employer is liable to pay, in addition to any other compensation under this Act, the cost of that treatment or service and the related travel expenses specified in subsection (2).…
(3)Payments under this section are to be made as the costs are incurred, but only if properly verified.”
Section 59 of the 1987 Act defines “medical or related treatment” as including treatment by a medical practitioner, hospital treatment including physiotherapy treatment and rehabilitation services, medical or surgical supplies and curative apparatus.
President Sheahan stated in Water Taxis Combined Pty Limited and Harbour Taxi Boats Pty Limited v Wells [2004] NSW WCC PD 30 (‘Water Taxis Combined’) at page 15 that:
“The 1987 Act provides for a worker to be compensated for reasonable medical costs, actually incurred and properly verified, resulting from an injury (see section 60(3) of the 1987 Act). An Arbitrator, therefore, does not have the power to make an order for the specified payment of medical expenses based upon an estimate of the likely future costs … An employer, however, will not be liable to pay the worker’s section 60 expenses until they have been incurred and properly verified.”
An order pursuant to section 60 of the 1987 Act, for a specified sum based on likely future costs or an estimate of the future costs for medical or related treatment, is not appropriate. However, this is not a bar to an order under section 60 for certain future medical expenses to become payable as and when they are incurred if the provisions of section 60 of the 1987 Act are satisfied (Water Taxis Combined and Lilly v Tomago Aluminium Co Pty Ltd [2004] NSW WCC PD 62).
In these circumstances I accept that the decision of the Arbitrator relating to section 60 expenses in this matter has a real capacity to put the amount of compensation claimed by the Appellant Worker in issue (Fletchers International; see also, Devine v Coles Supermarkets Australia Pty Ltd [2003] NSW WCC PD 28).
I find that the decision of the Arbitrator dated 7 July 2004 puts the amount of compensation in issue in this appeal as identified in Ian Sheridan, Fletchers International and Sheridan, which satisfies the threshold test in section 352(2) of the 1998 Act.
Leave to appeal against the decision of the Arbitrator dated 7 July 2004 was granted on 13 January 2006 and the parties were notified.
SUBMISSIONS
The Appellant Worker submits that there are two central issues to be determined by the Commission:
“(a) The Applicant [Appellant Worker] alleges he suffered injury to his hips in the course of and arising out of his employment with the Respondent as a result of the nature and conditions of his employment with the Respondent. Additionally the Applicant alleges his employment with the Respondent was a substantial contributing factor to these injuries. The Applicant alleges he suffered an injury consisting in the aggravation, acceleration, exacerbation and deterioration of a disease in accordance with Section 16 of the Workers Compensation Act 1987. Additionally, the Applicant alleges that his employment with the Respondent was a substantial contributing factor to the aggravation, acceleration, exacerbation and deterioration of the disease.
(b)Further the Applicant alleges he requires bilateral hip replacement surgery. The need for that surgery arose as a result of the above alleged injuries. The surgery is reasonably necessary medical treatment pursuant to Section 60 of the Workers Compensation Act 1987.”
The Appellant Worker submits that:
“(a) The Applicant [Appellant Worker] suffered an injury in the form of aggravation, acceleration and deterioration of a disease where the Applicant’s employment with the Respondent was a contributing factor to the aggravation, acceleration and deterioration of the disease.
(b)Relying on Section 9A, the relevant case law cited … and the opinions of Dr Kirwan and Dr Huntsdale, the Applicant submits that the aggravation, acceleration and deterioration of that condition arose out of and in the course of the Applicant’s employment with the Respondent. Consequently, the Applicant’s employment was a substantial contributing factor to the aggravation, acceleration and deterioration of the Applicant’s bilateral osteoarthritic condition ….
The Applicant submits that the opinion of Mr Kirwin, the Applicant’s treating surgeon should be preferred.
Consequently the Applicant submits that the Respondent is liable to pay compensation to the Applicant in accordance with Section 60 of the Workers Compensation Act 1987.
The Applicant submits that the Commission should find that bilateral hip replacement surgery is reasonably necessary pursuant to Section 60 of the Workers Compensation Act. ”
The Appellant Worker further submits that the decision of the Arbitrator contains an error of law as follows:
“1.… The Arbitrator made a finding that the Applicant’s [Appellant Worker’s] hip condition arose out of and in the course of his employment with the Respondent. The Arbitrator then held the Applicant’s employment was not a substantial contributing factor to the injury. The decision is contrary to the decision of the Court of Appeal in Mercer v ANZ Banking Group Ltd (2000) 20 NSWCCR 331 as applied in Farrelly v Qantas Airways Ltd (2001) 22 NSWCCR 331 and Jaboul v Qantas Airways Ltd (2001) 22 NSWCCR 229. The Applicant also relies on the following case law: Muscat v Woolworths Ltd (2000) 20 NSWCCR 283, Maher v Brambles Australia Ltd (1998) 17 NSWCCR 334, Reed v Qantas Airways Ltd (1999) 18 NSWCCR 461, Dayton v Coles Supermarkets Pty Ltd (2001) 22 NSWCCR 46 and Rootsey v Tiger Nominees Pty Ltd (2002) 23 NSWCCR 725.
2.The Applicant submits that, given the finding made by the Arbitrator that the Applicant’s injury arose out of the Applicant’s employment with the Respondent, the Arbitrator erred in then finding that the Applicant’s employment with the Respondent was not a substantial contributing factor to the injuries the subject of the Applicant’s Application to Resolve a Dispute. The causal connection required to satisfy ‘arising out of employment’ is a greater causal connection than ‘substantial contributing factor’: Healey v Delta Electricity [2000] NSWCC 21 [sic].
3.The Arbitrator accepts and finds that the medical evidence is that there is a direct causal relationship as opposed to merely a temporal relationship and then errs in finding that employment was not a substantial contributing factor.
4. The Applicant submits that the weight of the evidence, and in particular the medical evidence, is that the Applicant’s current condition of the Applicant’s hips arose out of the Applicant’s employment with the Respondent.
5.The Applicant submits that the decision of the Commission should be revoked because of the error of law and substituted with the following decision:
a.The Respondent is liable for the costs of the proposed bi-lateral hip replacement surgery.
b.The respondent pay the Applicant’s costs of the original application to the Commission and of the appeal.”
The Respondent Employer submits:
“…. The Applicant’s Submissions have referred to the various statutory provisions relevant to this question. The sections of particular significance are s4(b)(2) and s9A. The Applicant has referred specifically only to s9A(1) but the attention of the Commission is also directed to s9A(2), in particular paragraph (d) thereof which refers to the probability that the injury would have happened anyway at about the same time or at the same stage of the worker’s life if he or she had not been at work or had not worked in that employment. The medical opinion in this case, particularly that of Dr Bodel and Dr Huntsdale, fits squarely within s9A(2)(d).
The leading case on s.9A remains Mercer v ANZ Banking Group Limited (2000) NSWCA 138 (see also [2000] 48 NSWLR 740).
The Applicant’s Submissions seem to be suggesting that because it was held that ‘substantial contributing factor’ was a lesser test than ‘injury arising out of the employment’ the Applicant must succeed in the present case. It is submitted that does not follow. It was held by the Court in Mercer (paragraph 31) as follows:
‘It is not easy to apply a causation requirement to a provision which continues to define “injury” as including injury arising in the course of employment. However, work has to be found for all of the words used unless this proves an impossible task’.
Again, at paragraph 29 the Court stated:
‘s9A(2) requires the Court to take into account the probability that the injury or a similar injury would have happened anyway, at about the same time or at the same stage of the worker’s life, if he or she had not been at work or had not worked in that employment [paragraph (d)]’
The Court of Appeal returned the case to the Compensation Court for further determination by reason of an error by the trial judge in attaching significance to the absence of employment characteristics in the precise activity that led to the injury. Having said that, the Court went on to say (paragraph 37)
‘It may be thought that this construction of s9A leaves a broad area within which the personal judgment of the individual judge as to what is “substantial” may be determinative. So be it, if the legislation uses this language.’
The judgment goes on to consider other authorities relating to the difficulties and uncertainties which the use of the word ‘substantial’ is liable to cause. That seems to refer with approval to authority suggesting that the meaning of the word was equivalent to ‘considerable solid, or big’.
It is submitted by the Applicant that the question of whether the Applicant’s employment was a substantial contributing factor to the development of an osteoarthritic condition, is a question to be determined by the Commission. It is probably fair to say that it is a mixed question of law and fact but nevertheless considerable weight must be attached to the medical evidence on the question, particularly the opinion expressed by Dr Huntsdale as the authorised medical specialist appointed by the Commission to consider a particular question.
It is submitted that an application of Mercer’s case does not require that if there is a finding pursuant to s4 that the Applicant’s employment with the Respondent was a contributing factor to the aggravation acceleration or deterioration of the disease, that s9A can then be ignored. The Court, as previously discussed, is left with a broad area of discretion and personal judgment as to whether the contribution is substantial, and in the exercise of this judgment, due regard must be had to the medical opinion. In the present case it is submitted that due regard to that opinion would lead to a conclusion that the Applicant has not satisfied the onus under s9A of establishing that the employment with the Respondent was a substantial contributing factor to the injury.
Finally, it is submitted that the Commission has no power to order the payment of medical expenses until such expenses have been incurred. The Commission can, in effect, only make a finding as to whether there has been injury to the hips as claimed and as to whether one or both of the proposed operations would be reasonably necessary …”
In addition the Respondent Employer submits:
“…On the substantive issue of whether the Application satisfies Section 352(2) of the Act the Respondent notes that the Orders sought are that proposed surgery falls under the heading of ‘medical or related treatment’ and being ‘reasonably necessary’ as a result of an injury received by the Worker ….
On the substantiative issues the Respondent Employer submits the decision of … [the] Arbitrator dated 7 July 2004 is correct and consistent with the evidence and submissions of both parties …”.
EVIDENCE
Relevant Facts
I have before me the Arbitrator’s decision, the evidence that was before the Arbitrator and the parties’ submissions before the Arbitrator and on appeal.
The Appellant Worker commenced employment with the Respondent Employer in 1998, as a driver performing full time duties until 22 February 2003.
In the course of his employment with the Respondent Employer, the Appellant Worker was required to transport clients, including wheelchair-bound clients, from their homes to various destinations and home again. Whilst working with the Respondent Employer, the Appellant Worker was required to transport approximately ten wheelchair clients per day.
When transporting wheelchair clients to and from their destinations, the Appellant Worker was required to push them from their home to the back of the vehicle, push them onto a loading ramp, lift them using a hoist push them into the bus, secure the wheelchair at four points, drive them to their destination, unload them and push them into their destination and effect the return journey in the same manner. When transporting wheelchair clients, they had to be secured on the bus at four points for each chair. This required constant crouching and leaning over by the Appellant Worker to secure the chairs.
On 22 February 2003, whilst the Appellant Worker was leaning over to secure a wheelchair, he suddenly felt severe pain in his low back, radiating into his right buttock, right hip and down his right leg.
The Appellant Worker notified the Respondent Employer of his injuries on 22 February 2003. In mid 2003 the Appellant Worker lodged a claim with the Insurer for medical expenses. On 5 September 2003 the Insurer advised the Appellant Worker that it denied liability for the claim for medical expenses.
The Medical Evidence
The Appellant Worker relies upon the medical evidence before the Arbitrator which included the:
·Statement of the Appellant Worker dated 3 July 2003
·Medical reports of Dr Kirwan dated 20 August 2002, 14 October 2002 and 30 October 2002
·Medical reports of Dr Hillier dated 22 April 2002, 16 July 2002 and 26 August 2002
Dr Kirwan (the Appellant Worker’s treating orthopaedic surgeon) in his report dated 14 October 2002 stated:
“Firstly, I should address … where you state Dr Long feels that Mr Murphy’s ‘degenerative hip injury is not work related’.
I believe Mr Murphy doesn’t have an injury as such, rather he has a chronic and progressive mechanical condition in his hips which has been contributed to and exacerbated by his work ….
There is no doubt that Mr Murphy would have developed osteoarthritis of his hips whether he was unemployed, or whether he performed his job or another job. What can be said however is that any strenuous physical work and any aggravations that have occurred recently, have contributed to the progress of the disease and therefore brought the need for surgical correction forward ….
The general work duties have contributed to or aggravated the hip disease ….”
Dr Kirwan in his report dated 20 August 2002 stated:
“… it would be reasonable to assume that given the nature of his work, that his work has contributed to the development of arthritis in his hips.”
Dr Hillier in his report dated 22 April 2002 referred to radiological examinations of the Appellant Worker’s hips:
“Following up Mr Murphy with his hip x-rays, these do show that there has been a degree of symmetrical osteoarthritis of both hips, more marked on the left side producing some central migration of the femoral heads and bone to bone contact in the centre of the acetabulum …”
The Respondent Employer relied upon the medical evidence before the Arbitrator which included the medical reports of:
·Dr Long dated 19 August 2002 and 25 October 2002
·Dr Bodel dated 30 January 2003 and 19 March 2003
Dr Long states in a report dated 25 October 2002 at page 1:
“I agree with all Dr Hillier has to say except I do not believe there is a strong case regarding the association of his [the Appellant Worker’s] hip condition to his work during the past 3 or even 7 years. In fact, Dr Hillier agrees with this in part where he states – see page 2(3) of his letter of 14 October 2002 ‘There is no doubt that Mr Murphy would have developed osteoarthritis of his hips whether he was unemployed or whether he performed another job.’”
Further, at page 8 of his report dated 19 August 2002 Dr Long opines:
“Do you believe the worker’s hip condition was aggravated by the original accident?
The worker’s degenerative hip disease is coincidental and has not been aggravated by his work. It has resulted in a restriction of hip movement but no contributing pain or disability which could be related to the incident which occurred at work on 22 February 2002 or on any other occasion.
I do not believe that it is a contributing factor to the worker’s present disability.”
Dr Bodel in his report of 30 January 2003 at page 3 stated:
“In regard to the patient’s hip condition I have indicated above that this in my view is primarily a constitutional ailment. Life in general will aggravate this condition from time to time and the underlying condition will deteriorate over time. There is in my view no specific work related aggravation to the underlying pathology in the hips by the specific event at work on 22.2.2002 which was an injury to the back and clearly led to a disc prolapse in the back at the time.
Again, as I have indicated above, Mr Murphy’s employment is not a substantial contributing factor to the hip pathology. The hip pathology would have occurred by this stage in this patient’s life no matter what work he had been doing …”.
DISCUSSION AND FINDINGS
Employment as a Substantial Contributing Factor
As noted at paragraph 55 above, the Appellant Worker alleges he sustained injury on 22 February 2003 whilst employed by the Respondent Employer. In the course of treatment subsequent to the Appellant Worker’s injuries sustained on 22 February 2003, x-rays were taken of the Appellant Worker’s hips. Osteoarthritis was detected in each hip. Dr Kirwan, the Appellant Worker’s treating surgeon, in a report dated 16 October 2003 recommended bilateral simultaneous hip replacements. The Appellant Worker issued an application for the Insurer to pay the medical expenses relating to the procedure, which, as stated above was denied.
In addition to the medical reports filed and served in this matter the Arbitrator, on 3 March 2004, referred the Appellant Worker for Assessment of General Medical Dispute to an Approved Medical Specialist (“AMS”), Dr W Huntsdale. The referral included the following:
“Date/s of injury
22 February 2002 (Deemed Date)
What are the issues in dispute?
Whether the Applicant’s Employment was a substantial contributing factor to osteoarthritic changes to the Appellant’s hips.
… Specific questions the parties require the AMS to answer
1. Has the Applicant suffered osteoarthritic changes to his hip(s)? and if ‘Yes’:
2. Were those changes caused by the Applicant duties in his employment with the Respondent?
3. Were those changes aggravated by the Applicant’s duties in his Employment with the Respondent?
4. Was the Applicant’s Employment with the Respondent a substantial contributing factor to those changes?
.…”
Issues relevant to the application of section 9A of the 1987 Act were considered by the AMS and the AMS produced a Medical Assessment Certificate (“MAC”) dated 5 April 2004 which was before the Arbitrator.
The Arbitrator considered the Medical Assessment by Dr Huntsdale and referred to the medical assessment in his decision as follows:
“In relation to the issues on which a Medical Assessment Certificate is not conclusively presumed to be correct, the AMS opinion is as follows: Dr Huntsdale acknowledges that the back injury is a direct result of the Appellant’s work, however, the osteoarthritic change in the hips is constitutional in nature and not related to his work with the Respondent. He specifically disagrees with the opinions expressed by Drs Kirwan and Hillier that there is a relationship between the two and agrees with the conclusion of Dr Bodel.”.
At paragraph 27 of page 5 of the Statement of Reasons, the Arbitrator found that:
“There is no argument that the arthritic changes to the Applicant’s hips are constitutional. What is of importance is whether the Applicant’s employment with the Respondent caused aggravation, acceleration, exacerbation and/or deterioration of it? Dr Kirwan is very vigorous in his argument that it did. Dr Long appears to say that ‘activities’ can accelerate the condition. Dr Bodel says ‘life in general will aggravate this condition’ and Dr Huntsdale acknowledges the arthritic changes were aggravated by the Applicant’s duties but adds the caveat that ‘any type of work of a relatively physical nature would have aggravated (the arthritic) changes’. Therefore, the medical argument appears to be one of degree rather than the existence of any connection between the injury and work.”
The Arbitrator examined the evidence and found a nexus between the Appellant Worker’s work and hip condition. The Arbitrator stated at paragraph 28, page 5 of his Statement of Reasons that: “… there is no great difficulty in finding that the same [the Appellant Worker’s hip condition] arose out of or in the course of the employment”. The Arbitrator then identified that the real issue to be determined is whether the employment was a substantial contributing factor.
Having found that the Appellant Worker suffered an ‘injury’ pursuant to section 4 of the 1987 Act, which, on the evidence it was open for him to do, the Arbitrator must then determine whether his employment was a ‘substantial contributing factor’ to that injury, in accordance with section 9A of the 1987 Act, which provides as follows:
“9ANo compensation payable unless employment substantial contributing factor to injury
(1) No compensation is payable under this Act in respect of an injury unless the employment concerned was a substantial contributing factor to the injury.
(2) The following are examples of matters to be taken into account for the purposes of determining whether a worker’s employment was a substantial contributing factor to an injury (but this subsection does not limit the kinds of matters that can be taken into account for the purposes of such a determination):
(a) the time and place of the injury,
(b) the nature of the work performed and the particular tasks of that work,
(c) the duration of the employment,
(d) the probability that the injury or a similar injury would have happened anyway, at about the same time or at the same stage of the worker’s life, if he or she had not been at work or had not worked in that employment,
(e) the worker’s state of health before the injury and the existence of any hereditary risks,
(f) the worker’s lifestyle and his or her activities outside the workplace.
(3) A worker’s employment is not to be regarded as a substantial contributing factor to a worker’s injury merely because of either or both of the following:
(a) the injury arose out of or in the course of, or arose both out of and in the course of, the worker’s employment,
(b) the worker’s incapacity for work, loss as referred to in Division 4 of Part 3, need for medical or related treatment, hospital treatment, ambulance service or occupational rehabilitation service as referred to in Division 3 of Part 3, or the worker’s death, resulted from the injury.
(4) This section does not apply in respect of an injury to which section 10, 11 or 12 applies.”
The following cases raised by the Appellant Worker in submissions have been considered: Mercer v ANZ Banking Group Ltd [2000] 48 NSWLR 740 (‘Mercer’); Farrelly v Qantas Airways Ltd (2001) 22 NSW CCR 331 (‘Farrelly’); Jadoul v Qantas Airways Ltd (2001) 22 NSW CCR 229 (‘Jadoul’); Muscat v Woolworths Ltd (2000) 20 NSW CCR 283; Maher v Brambles Australia Ltd (1998) 17 NSW CCR 334; Reed v Qantas Airways Ltd (1999) 18 NSW CCR 461; Dayton v Coles Supermarkets Pty Ltd (2001) 22 NSW CCR 46; Rootsey v Tiger Nominees Pty Ltd (2002) 23 NSW CCR 725 and Healeyv Delta Electricity (2000) 20 NSW CCR 491. The interpretation of section 9A has been considered by the Commission in numerous cases where the relevant cases have been analysed. A succinct elucidation is found in the decision of Deputy President Dr Fleming in Central Coast Area Health Service v Clara Evans [2004] NSW WCC PD 10 (‘Central Coast Area Health Service’).
In Central Coast Area Health Service Deputy President Dr Fleming stated:
“Recent cases illustrate conflicting interpretations of the Mercer case. In Jadoul v Qantas Airways [2001] NSW CC 175, Burke J, stated (at paragraph 21) that:
‘I am bound by the decision in Mercer and that I take to require that the concept of substantial contributing factor is to be regarded as, at least, no more onerous than the concept of arising out of the employment. If injury arises out of the employment then the employment is necessarily a substantial contributing factor to the injury’.
This interpretation of Mercer was expressly, albeit briefly, rejected by the Court of Appeal, (Mason P, with whom Meagher JA and Handley JA agreed), in the more recent case of ICM Agriculture Pty Ltd v Perry [2002] NSW CA 257. Such an approach is also inconsistent with the express words of Section 9A (3)(a) which states that a finding the injury arose out of or in the course of employment is not, in itself, a basis for a finding of substantial contributing factor.
The word ‘substantial’ must be given its normal meaning, and, as Meagher JA noted in Dayton v Coles Supermarkets Pty Limited [2001] NSWCA 153 at paragraph 16, ‘this word is a plain English word which is understood by anyone who is not a judge’.
. Employment need not be the only substantial contributing factor to the Appellant Worker’s injury. Other causative factors may operate. It is sufficient if it is ‘a’ substantial contributing factor that is “more than minimal” (Mercer v ANZ Banking Group [2000] 48 NSWLR 740). In most cases it remains a question of ‘impression and degree’ on the facts of the instant case (Dayton v Coles Supermarkets Pty Limited [2001] NSWCA 153 at paragraph 25).”
I agree with Deputy President Dr Fleming’s interpretation of section 9A of the 1987 Act.
The Appellant Worker submits that given the finding made by the Arbitrator that the Appellant Worker’s injury arose out of the Appellant Worker’s employment with the Respondent Employer, the Arbitrator erred in then finding that the Appellant Worker’s employment with the Respondent Employer was not a substantial contributing factor. The Appellant Worker is contending that the causal connection required to satisfy ‘arising out of employment’ is a greater causal connection than ‘substantial contributing factor’.
The Arbitrator did not agree with this analysis of the case law and relied particularly on Mercer.
The Court of Appeal in Mercer at page 747 considered whether ‘a substantial contributing factor’ was as stringent a concept as that of ‘arising out of the employment’, if not more so. The Court of Appeal, at page 6, stated:
“The requirement that employment be a contributing factor to the ‘injury’ is not equivalent to the expression ‘arising out of the employment’. It is not easy to apply a causation requirement to a provision which continues to define ‘injury’ as including injury arising in the course of employment. However, work has to be found for all the words used, unless this proves an impossible task. S9A(3)(a) does not preclude this, because it goes no further than deeming employment not to be a substantial contributing factor to an injury ‘merely because’ the injury arose in the course of the worker's employment etc.”
Recently, in Chubb Security Australia Pty Ltd v Trevarrow [2004] NSWCA 344, the Court of Appeal provided the following guidance. Santow JA stated at paragraph 36 (Beazley JA and Ipp JA concurring) that:
“… [having] regard to the relevant authorities the net effect of which confirms that the fact that an injury arose out of or in the course of employment, while not determinative of whether employment was a substantial contributing factor, is not irrelevant either: Supair Pty Ltd v Sweeney (2000) 20 NSW CCR 514 at 516, Mercer (supra) at 747-8.”
The Arbitrator at paragraph 28 on page 5 of the Statement of Reasons stated:
“I cannot accept the Applicant’s argument that if the injury arose out of or in the course of employment then the employment is a substantial contributing factor. That argument would tend to make 9A superfluous, which cannot be so. Indeed, s9A(3)(a) provides:
‘A worker’s employment is not to be regarded as a substantial contributing factor to a worker’s injury merely because of either or both of the following:
(a)the injury arose out of or in the course of or arose both out of and in the course of, the worker’s employment … … …’”
The Arbitrator considered the Appellant Worker’s submission in respect to the construction of section 9A of the 1998 Act and the relevant case law and rejected it. It was open to the Arbitrator in accordance with the principles enunciated in the relevant case law to do so. I find no error in the Arbitrator’s approach.
Deputy President Dr Fleming in Knight v Eyles Nominees Pty Limited t/as Processed Forest Products [2004] NSW WCC PD 73 at page 6, summarised the approach to be followed in reviewing the exercise of an Arbitrator’s discretion and any error which may have been made by an Arbitrator of law, fact or discretion as follows:
“The errors alleged … are largely matters of discretionary judgment by the Arbitrator, on the basis of his [her] view of the evidence before him [her]. As with any exercise of discretion by an administrative decision maker, this discretion must be exercised lawfully and fairly, taking into account the scope of the discretion and the objects of purpose for which it is conferred. To succeed on the grounds of appeal the Appellant must demonstrate that the Arbitrator has failed to exercise his [her] discretion fairly and lawfully.”
An Arbitrator’s decision should not be disturbed unless, on review, it contains an error of law, fact or discretion (Allesch v Maunz (2000) 203 CLR 172, Mayne Health Group t/as Nepean Private Hospital v Sandford [2002] NSW WCC PD 6). The error must be such that, but for it, a different decision would have been made (section 294 of the 1998 Act; YG and GG v Minister for Community Services [2002] NSW CA 247; Absolon v NSW TAFE [1999] NSW CA 311.
The Arbitrator determined this matter ‘on the papers’. The Arbitrator set out the documentary evidence, the matters arising from the Appellant Worker’s statement including the time, place and circumstances of the alleged injuries sustained by the Appellant Worker, the nature of the work performed and the particular tasks of that work, the duration of employment and the Appellant Worker’s age.
The Arbitrator examined the medical reports relied upon by the parties and considered the opinions of the medical experts including the AMS as to the probability of the hip condition suffered by the Appellant Worker occurring at about the same time or at the same stage of the Appellant Worker’s life whether he had not been at work or had not worked in the relevant employment. The Arbitrator also requested the AMS to specifically address these matters as noted in paragraph 66 supra and considered the matters raised in the MAC.
The Arbitrator set out his consideration of the evidence and the weight to be attributed to the various medical reports. The Arbitrator concluded at paragraph 30 at page 5 of his Statement of Reasons as follows:
“In this instance I have no difficulty in concluding that on any of these ‘tests’ the Applicant’s [Appellant Worker’s] employment could not be found to have been a substantial contributing factor to his hip condition. I base this conclusion on the totality of the medical evidence and the Applicant’s description of the work he did. Further, I have regard to s9A(2)(d), which recognises the coincidence of employment and the existence of a constitutional condition.”
While a finding that injury arose during the course of employment is not determinative of employment being a substantial contributing factor, having regard to section 9A(3) of the 1987 Act, it is a relevant consideration in such a determination: Supair Pty Ltd v Sweeney (2000) 20 NSWCCR 514. This along with all the other evidence must be examined and weighted to determine whether the relevant employment was a substantial contributing factor beyond the ‘merely because’ test prescribed in section 9A(3) of the 1987 Act: Mercer; Farrelly and Jadoul as cited in Department of Education and Training v Cathryn Wendy Ingle [2003] NSW WCC PD 18. Determining what is a ‘substantial’ contributing factor is within the personal judgement of the Arbitrator (Mercer at pages 748 and 749). As previously stated, the Arbitrator took all of the evidence into account and it was open to him to find that the Appellant Worker did not satisfy the requirements of section 9A.
Weighing all the evidence and taking into account the matters set out in section 9A of the 1987 Act I am satisfied that the Arbitrator did not err in finding that the Appellant Worker’s employment was ‘not a substantial contributing factor’ to his injury. The evidence is sufficient to support such a finding.
As the Arbitrator’s decision is confirmed, no finding can be made in respect to the medical or related expenses and the reasonableness of the proposed treatment sought by the Appellant Worker pursuant to section 60 of the 1987 Act.
DECISION
Leave to Appeal against the decision of the Arbitrator is granted.
On the whole of the evidence, no error of law, fact or discretion has been made by the Arbitrator. The appeal is not allowed. The decision of the Arbitrator dated 7 July 2004 is confirmed.
COSTS
No order as to the costs of the appeal.
Mary Walker
Acting Deputy President 2 March 2006
I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF Deputy President Mary Walker, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
0
14
0