NSW Police Force v P - [2010] NSWWCCPD 26

WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:		NSW Police Force v P [2010] NSWWCCPD 26
APPELLANT:		NSW Police Force
RESPONDENT:		P
INSURER:		Allianz Australia Insurance Limited as agent for the TMF No 3
FILE NUMBER:		A1-4395/09
ARBITRATOR:	Mr J McDermott
DATE OF ARBITRATOR’S DECISION:		18 September 2009
DATE OF APPEAL DECISION:		15 March 2010
SUBJECT MATTER OF DECISION:		Psychological injury; sections 4, 9A and 11A of the Workers Compensation Act 1987; adequacy of reasons.
PRESIDENTIAL MEMBER:		Acting Deputy President Deborah Moore
HEARING:		On the papers
REPRESENTATION:		Appellant: DLA Phillips Fox
Respondent: Baker & Edmunds
ORDERS MADE ON APPEAL:		The decision of the Arbitrator dated 18 September 2009 is confirmed.
The Appellant is to pay the costs of the appeal.

BACKGROUND TO THE APPEAL

The Respondent, Ms P, (nee P) commenced employment with the Appellant, the New South Wales Police Force, in May 1988 working at various Sydney suburban locations.

In a 116 page statement, she set out the history and circumstances surrounding her claim. Given the nature of the dispute, I consider that it is appropriate that I summarise the background to her claim in some detail, as follows.

In August 1991 she joined the Witness Security Unit as part of the State Protection Group, involved often difficult covert operations. In April 1992 she was trained as a police negotiator, and attended what she described as “numerous incidents of a high risk nature” such as sieges and suicides. In 1993 she and her then husband, also a police officer, made application for a transfer to Bourke.

In November 1993 she was seconded to Sutherland Detectives Office. She was involved in the investigation of the Jannali bush fires in January 1994. She said that the death and destruction she witnessed caused her considerable distress.

In March 1994 she and her husband transferred to Bourke. On 16 June 1994 she was the victim of a violent assault and feared for her life. She continued at work but said that she became anxious and had trouble sleeping. She also said that she was aware of resentment by other officers because of her qualifications and “being female” which lead to conflict at the Bourke station.

As a result of her conduct during the Jannali fires, she was awarded the Commissioner’s Valour Award for bravery. She was notified of this while at Bourke. Comments from her Patrol Officer about her travelling to Sydney for the ceremony she said made the event “distressing and upsetting.” When she resumed work wearing her medal on the right side, she was wrongly castigated by other officers for not wearing it on the left. As a consequence, she said she was distressed and broke down, becoming worried and anxious about her work.

In February 1995 she eventually contacted the Appellant’s Employee Assistance Branch where it was suggested that she seek medical attention. She ceased work and consulted Dr Greenburg at Bourke Hospital who referred her to a visiting psychiatrist, Dr Burke. He put her off work and referred her for treatment in Sydney by another psychiatrist, Dr Michael Bowden. She was off work until July 1995, during which time she said she had no contact from the Appellant and felt that she was “not wanted.”

In June 1995 she was assessed as unfit to resume duties at Bourke. On 3 July 1995 she commenced in a non-operational position performing generally administrative duties.

The relevant insurer for the Appellant at that time was the GIO. Ms P claimed that delays and queries from the GIO during 1996 about the time she took off as sick leave between February and July 1995 together with an internal affairs investigation by the Appellant added to her distress such that she “relapsed” and recommenced treatment with Dr Bowden. On 20 August 1996 she suffered a grand mal seizure as a consequence of her anti-depressant medication and was again put off work.

It appears that the GIO ultimately accepted liability for the periods of time off work in 1995 and 1996.

Ms P said that her condition continued “long after the closed period” and she continued to have treatment for depression and anxiety throughout 1996 and 1997. Meanwhile, her husband had been involved in some difficult operations and also came under the care of a psychiatrist. He was medically discharged by the Appellant in September 2001. He and Ms P were divorced in March 2003.

In March 1999 Ms P was appointed coordinator within the Investigations Unit, Special Crime and Internal Affairs Command (SCIA). Ms P said that because of a “clandestine management style, pressure of working within this office and being investigated by your own colleagues” her health again deteriorated which caused her “shame and embarrassment.” She again sought treatment from Dr Bowden.

By March 2002 she said that because her health problems continued, she took eight months leave of absence. She resumed work in October 2002 this time as a coordinator with the Negotiations Unit. She was required to fill in as the Commander at Chief Inspector level for some time which involved long hours. She found this work stressful and difficult.

In July 2003 she underwent training as a National Counter Terrorist Negotiations Team Leader in Queensland. She said she was not coping well, and had difficulty sleeping well and concentrating.

In October 2003 she commenced duties as the HR Manager at the Inner Metropolitan Region Office. This role she said also caused her considerable anxiety and distress because of the need to deal with aggressive and hostile colleagues. In November 2003 she suffered a severe “anxiety stress reaction” requiring hospitalisation. Rehabilitation arranged by the Appellant saw her transferred to another non-operational position in “suitable duties” in early 2004 in the Work Force Planning section. Dr Bowden had retired from practice and in February 2004 she consulted another psychiatrist, Dr O’Brien. Liability was accepted by the Appellant for this incident.

She continued to consult with Dr O’Brien throughout 2004 because of ongoing symptoms, but remained at work. In November 2004 she commenced further anti-depressant medication and was off work for periods of time.

She had considerable periods of time off work throughout 2005. There was apparently some difficulty in the processing of her claim with the GIO during this time, principally over the issue of sick leave and the receipt of medical certificates. A leave audit was undertaken.

In January 2006 Allianz Australia Insurance Limited (‘Allianz’) took over as insurer of the Appellant.

Whilst on holiday in Scotland in December 2005 Ms P fell and fractured her left fibula. She received ongoing treatment for this injury on her return to Australia in January 2006.

Throughout 2006 there were apparently ongoing issues with Allianz over leave entitlements which involved Ms P in numerous meetings and correspondence with her superiors and representatives from Allianz. She continued to consult Dr O’Brien regularly. Ms P said that during this time, she also had problems at work due to the behaviour of a colleague, Mr Comptom.

Ms P commenced Maternity Leave on 5 March 2007. Her son was born on 6 March 2007 after which she resumed treatment with Dr O’Brien.

Ms P said that, whilst on maternity leave, on 26 June 2007, she was contacted by Ms Aiken, her case manager at Allianz. Ms P said that Ms Aiken asked her why she was still receiving treatment from Dr O’Brien and when she intended to return to work. Ms P said that Ms Aiken said that she had “lost the papers” in relation to her most recent claim for expenses, and that Ms Aiken was “sarcastic” throughout the conversation. Ms P said that she became increasingly distressed and anxious eventually “exploding into rage.”

In July 2007 Ms P was advised that she had received an overpayment of salary and that there were “anomalies” in her sick leave entitlements. At that time, Ms P also sought extended maternity leave without pay to March 2008. This involved further communication with her superiors, in particular, the HR Manager, Ms Dalton, and Ms Aiken. Ms P claimed that her symptoms increased such that she saw her general practitioner and was certified unfit for work from 16 August 2007 to 10 December 2007.

On 21 August 2007 Ms Aiken rang her to advise that she was required to be “reassessed” because she had now been certified unfit for work where previously she had been certified fit for suitable duties. She was asked to attend for interview and also to undergo medical examination by Allianz’s doctor, Dr Leonard Lee. This process Ms P said caused her considerable distress and anxiety throughout the remainder of the year.

On 6 December 2007 Allianz wrote to Ms P declining liability for her claim from 16 January 2008, principally on the basis of Dr Lee’s report.

In an ‘Application to Resolve a Dispute’ (‘the Application’) registered in the Commission on 9 June 2009, Ms P sought weekly benefits from 17 January 2008 and medical expenses. The date of injury was described as “1994” and the description as follows:

“1.     Probable acute stress disorder at the time of the Jannali Bushfires in 1994 and at Bourke.
2.       Chronic Post Traumatic Stress Disorder from 1994 onward.
3.     Chronic Major Depressive Disorder-fluctuating in severity-present intermittently from 1995 onwards-currently in substantial remission.
4.     Panic Disorder.”

The parties attended a hearing before the Arbitrator on 2 September 2009. No oral evidence was given, and submissions by the representatives for both parties are recorded in a transcript of that date.

In a reserved decision delivered on 18 September 2009, the Arbitrator found in favour of Ms P.

DECISION UNDER REVIEW

The Certificate of Determination dated 18 September 2009 with an accompanying Statement of Reasons (‘Reasons’) records the following formal orders:

“1. The Respondent to pay the Applicant weekly benefits pursuant to Section 40 as follows:
a.From 17 January 2008 to 31 March 2008 in the amount of $367.70 per week.
b.From 1 April 2008 to 30 September 2008 in the amount of $374.90 per week.

c. From 1 October 2008 to 31 March 2009 in the amount of $381.40 per week.
d.From 1 April 2009 to 11 September 2009 in the amount of $389.10 per week and ongoing.

2. The Respondent to pay the Applicant’s reasonable medical expenses pursuant to section 60 of the Act upon production of accounts or receipts.

3. The Respondent to pay the Applicant’s costs as agreed or assessed.”

It is from this decision that the Appellant seeks leave to appeal.

ON THE PAPERS REVIEW

Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) provides:

“(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 Directions Numbers 1 and 6, the documents that are before me, and the submission by the parties that the appeal can proceed to be determined on the basis of these documents, I am satisfied that I have sufficient information to proceed ‘on the papers’, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances.

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.

The appeal was lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act. . The amount at issue on appeal satisfies the threshold requirement s of section 352(2).

Leave to appeal is granted.

OTHER PRELIMINARY MATTERS

The material in this case, particularly from Ms P, is extraordinarily voluminous. Having carefully read all the files, it became apparent that some documents relied on by the parties and referred to by the Arbitrator were missing.

Accordingly, a teleconference was arranged with the parties at the earliest opportunity on 2 February 2010. A direction was issued following that conference whereby the Appellant was directed to file its Application to Admit Late Documents dated 31 August 2009 and its supplementary submissions dated 3 December 2009.

The Respondent was directed to file further submissions in relation to the admission of a report of Dr Bowden dated 12 April 1996 (sought to be admitted by her as ‘fresh evidence’) and to file submissions as to the nature of Ms P’s duties at the time she commenced her maternity leave (directed at the evidence on this issue).

The Appellant was then granted leave to file any further submissions by 18 February 2010.

Both parties have complied with this Direction, and I am satisfied that I now have all the material that was before the Arbitrator, and all the submissions on appeal.

FRESH EVIDENCE

‘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:

“FRESH EVIDENCE AND/OR ADDITIONAL EVIDENCE
Each application to introduce fresh evidence or additional evidence on appeal will be considered on its own facts and circumstances and in the context of the Commission’s obligation to act according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms (see section 354 of the 1998 Act).
In the exercise of its discretion to admit fresh evidence or further evidence on appeal the Commission will have regard to, and the parties should make submissions on, whether:
·it can be demonstrated that the evidence could not with reasonable diligence have been obtained by the party and tendered in proceedings before the Arbitrator;
·the evidence is credible;
·there is a high degree of probability that there would have been a different decision if the evidence had been admitted at the arbitration, and/or
·it is just to admit the evidence in all the circumstances of the individual case.

Parties should be aware that a review under section 352 of the 1998 Act is not a rehearing or hearing de novo. The original arbitration should not be treated as a preliminary hearing and all relevant evidence should be called at that time.”

Practice Direction No.6 also provides that if fresh evidence or evidence in addition to or in substitution for the evidence received in relation to the decision appealed against is relied upon, parties must include:

·        a schedule of the fresh or additional evidence;
·        a copy of the fresh or additional evidence;
·        a brief outline of the fresh or additional evidence and the reasons why it was not given in proceedings before the Arbitrator, and
·        submissions on why the fresh or additional evidence should be admitted, or rejected as the case may be.

Where a party seeks leave to rely on fresh or additional evidence in relation to the decision appealed against, that party must serve a copy of the fresh or additional evidence on the other parties to the dispute when serving the Application or Notice of Opposition.

The Respondent seeks to admit a report of Dr Michael Bowden, Consultant Psychiatrist, dated 12 April 1996. There was in evidence before the Arbitrator two reports of Dr Bowden, one dated 4 April 1995 and the other 27 November 2003. Those two reports were annexed to the Appellant’s ‘Application to Admit Late Documents’ dated 31 August 2009, and were part of documents produced by Dr O’Brien, Ms P’s current psychiatrist and Dr Singer, her treating general practitioner.

Those documents had not been served on the Respondent prior to the hearing on 2 September 2009, but were admitted with the consent of the parties.

The Respondent claims that the report of Dr Bowden of 12 April 1996 only came into her possession “in the last week” before filing the ‘Notice of Opposition’ to the appeal. The report is addressed to the Appellant’s workers compensation insurer and, the Respondent submits, “would not take the Appellant by surprise and in the interests of justice should be admitted to provide a complete understanding as to the opinion and history obtained and relied on by Dr Bowden.” In subsequent submissions filed following my Direction, the Respondent adds little, other than to re-affirm her view that “justice demands” that the report be admitted, and that it is “entirely inappropriate” for a party tendering an expert report to fail to tender all reports. The Respondent does however concede that the Appellant was not aware of the report prior to the hearing.

The Appellant objects to the admission of this report principally on the grounds that the Respondent has not provided sufficient information as to how or when she obtained the report, and has failed to comply with the requirements of section 352(6) of the 1998 Act, and Practice Direction No. 6. In addition, the Appellant points out that it was not aware of the existence of this report, noting that it is 14 years old and the relevant insurer has since changed. Reference is made to the decision of the Court of Appeal in Haider v JP MorganHoldings Aust Ltd t/as JP Morgan Operations Australia Pty Ltd (2007) 4 DDCR 634 (‘Haider’).

In the Appellant’s submission, in Akins v National Australia Bank (1994) 34 NSWLR 155 Clarke JA, at [160], with whom Sheller JA and Powell JA agreed identified three conditions that need to be met before ‘fresh evidence’ could be admitted:

“These are: (1) It must be shown that the evidence could not have been obtained with reasonable diligence for use at the trial; (2) The evidence must be such that there must be a high degree of probability that there would be a different verdict; (3) The evidence must be credible.”

In addition, the Appellant relies on the decision of Deputy President Roche in Naidu v AbleManufacturing Pty Ltd [2007] NSWWCCPD 237. In the Appellant’s submission, although the interests of doing justice between the parties is a factor to be considered, “it would only be in ‘exceptional circumstances’ that such considerations would warrant fresh evidence being admitted…no such exceptional circumstances have been made out in this case.”

The principles governing the admission of fresh or additional evidence were considered by ADP Snell in Box v APKEngineering Pty Ltd [2009] NSWWCCPD 149 (‘Box’). He considered the observations of Basten JA in Haider noting at [20-21]:

“20. …At [44] Basten JA, dealing with the admission of evidence pursuant to the discretion in section 352(6), said:

“Assuming for present purposes that the evidence was material and probative, the statutory obligations and powers imposed and conferred on the Tribunal suggest that the material should have been considered in order to address the substantial merits of the case.”

21. The power to admit evidence that is in addition to, or substitution for, the evidence received at the arbitration hearing, pursuant to section 352(6), must be exercised having regard to sub-sections 354(1) to (3) of the 1998 Act (Haider at [41] to [42]).”

In my view, given that two other reports of Dr Bowden are in evidence, the report of 12 April 1996 is both material and probative, and is in effect “additional evidence.” Notwithstanding the Respondent’s failure to strictly comply with the requirements of the legislation, in line with the observations of Basten JA referred to above, I believe that it is in the interests of justice to admit the document, bearing in mind the provisions of section 354 of the 1998 Act.

THE ISSUES IN DISPUTE

The Appellant has identified six grounds of appeal as follows:

“1 …the Arbitrator erred in determining that the Respondent worker’s injury satisfied section 4(b)(ii) of [the 1987 Act].
2 …the Arbitrator has erred in the analysis of, and findings under, section 9A of the Act.
3 …even if the appeal under grounds 1 and 2 are unsuccessful, the Arbitrator has erred in finding that the conduct of the insurer was not reasonable within the meaning of section 11A(1) of the Act.
4 …the Arbitrator has provided no, or no sufficient reasons for his determination that the conduct of the insurer was not reasonable within the meaning of section 11A(1) of the Act.
5 …the Arbitrator erred in his analysis and application of the ‘wholly and predominantly’ threshold under section 11A(1) and that his findings in fact conflict with his own citations of relevant case law on that issue.
6 …the Arbitrator has provided no, or no sufficient reasons for his determination of ‘wholly and predominantly’ or ‘provision of employee benefits’ under section 11A(1) of the Act.”

In short, the Appellant submits that the Arbitrator erred in his findings on injury, sections 9A and 11A of the 1987 Act, and in failing to give adequate reasons for his decision. No challenge is made to the quantum of the award, rather the Respondent’s entitlement to it.

THE ARBITRATOR’S FINDINGS AND REASONS

I will consider the Arbitrator’s findings and reasons more fully when discussing the various grounds of appeal.

The Arbitrator noted the Appellant’s submission that Ms P’s current “psychological problems (the existence of which are admitted)” fell into the category of ‘injury’ as defined in section 4(b)(ii) of the 1987 Act, that is, “the aggravation, acceleration, exacerbation or deterioration of any disease where the employment was a contributing factor to the aggravation, acceleration, exacerbation or deterioration…” but that Ms P had to establish that her employment was a substantial contributing factor to any such aggravation.

The Appellant’s principal argument was that the ‘aggravation’ occurred as a consequence of the telephone discussion with Ms Aiken from Allianz in June 2007, and that, since this did not occur in the course of employment it did not satisfy either section 4 or 9A.

The Respondent argued that the injury was not so much a case of an ‘aggravation’ but rather the continuing consequences of her diagnosed “Post Traumatic Stress Disorder” exacerbated by certain cues or triggers.

The Arbitrator concluded at [46]-[47] of his Reasons that:

“Having considered the submissions of the parties, I find that on the balance of probabilities, this is an example of aggravation to which Section 4(b)(ii) applies and as dealt with in Federal Broom. [Federal Broom Co Pty Ltd v Semlitch (1964) 110 CLR626]
Whilst the Respondent has asserted that the aggravation did not arise “in the course of employment”, it appears clear to me that it was an “injury arising out of or in the course of employment” [Section 4(a)].”

At [48], the Arbitrator turned to consider the issue of section 9A and concluded that the telephone call which apparently triggered a decline in or “aggravation” of Ms P’s condition was a substantial contributing factor to her injury “taken in the overall context of the Applicant’s employment history” at [56].

He commenced his consideration of the section 11A issue at [57] and concluded at [61-62] as follows:

“It may have been reasonable, notwithstanding the poor record keeping, for the Respondent/ its Insurer to contact the Applicant to update her details.
The Insurer however knew that the Applicant was suffering from a psychological injury. In all the circumstances, dealt with at Paragraphs 222 to 224 inclusive of the Applicant’s Statement which is uncontested, the attitude taken by the Insurer was not reasonable.”

At [64] he dealt with the ‘incapacity’ issue, noting at [67] that: “The Respondent has confirmed that, whilst making no admission as to liability, there are to be no submissions in reply as regards the Applicant’s mathematics.” He accepted Ms P’s calculations and entered an award accordingly.

THE EVIDENCE

The Medical Evidence

The Appellant did not challenge the overwhelming evidence that Ms P suffers from a psychological injury. The real issue was the nature of that injury in terms of section 4 of the 1987 Act, and the impact of sections 9A and 11A on any entitlements.

It is nonetheless appropriate to consider the medical evidence relied on by the parties in order to place the Appellant’s appeal in context.

Ms P was referred to Dr Bowden by Dr Greenberg from the Bourke Medical Centre. In a report dated 4 April 1995 addressed to Dr Greenberg, he said:

“As you are aware of Ms P’s history, I wont go into all the details here. As you know, she has developed a depressive illness in the context of several ongoing stresses. On further questioning, it appears that her depressive symptoms actually commenced some two years ago, in the period leading up to her wedding when she faced family stresses. She and her husband moved to Bourke…
Ms P’s depressive symptoms remained as described by Dr Burke, with the exception that she had also suffered three panic attacks, with classical symptoms, subsequent to Dr Burke’s assessment…”

Dr Bowden recommended treatment by way of medication.

In his report dated 12 April 1996 addressed to the GIO, he said:

“Mrs P was first assessed by me on 16 March 1995, having been referred by…Dr Greenberg and subsequent to having been assessed by Dr D Burke, psychiatrist at the St George Hospital…
Mrs P related her illness to the stress she described as having occurred…at Bourke.
She noted that a difficult incident with a local resident had occurred and that she had felt very unsupported at work. She stated that she often felt undermined and excluded at work and that these problems escalated to the point that she felt victimised in the work situation. She described her depressive symptoms developing as a response to the increasingly difficult work situation and her symptoms being exacerbated by her work problems.
Mrs P also told me of problems in her husband Scott’s family prior to her move to Bourke. These had resulted in an internal police investigation which she and Scott had found distressing. However, she found herself less affected by these difficulties as she was less directly involved…[she] felt that it was only subsequent work related events which had precipitated her depressive illness.
Mrs P had no previous history of psychiatric illness nor of depressive illness…
I diagnosed Mrs P as suffering from Major Depression…
She showed a gradual continuing improvement in her symptoms and was able to return to work part time on 3 July 1995 eventually returning to work full time…At this time, to the best of my knowledge, she remains free of depressive symptoms and is able to continue to work full time. Her prognosis is good, having had a complete recovery from her illness…
In my opinion Mrs P’s Depressive Illness would appear to be directly related to the stressors which she describes occurring at her work place…”

In his final report dated 27 November 2003, addressed to Dr Singer, Ms P’s general practitioner, he advised his intention to cease practice at the end of 2003, and noted that Ms P had been to see him in June 2003 “due to some work related stresses as well as some family issues.” He said:

“She found it helpful to talk through these issues over several sessions and did not need any further follow up at this time. She has remained free of depressive symptoms for an extended period of time now and does not feel that she needs any ongoing follow up.”

On 2 February 2004, Ms P first consulted Dr Elizabeth O’Brien, psychiatrist. In a report dated 9 February 2004 addressed to Dr Bowden, she said:

“[Ms] P appears to have recovered from the depression from the mid 1990’s, but more recently has had a resurgence in anxiety symptoms associated with work stresses and the offer of a promotion. It appears that the underlying personality vulnerabilities remain active…”

Various records, in particular “Time Lost” applications submitted by Ms P to the Appellant suggest that Ms P has continued to consult with Dr O’Brien regularly since that time.

In a report dated 13 September 2006 addressed to Dr Singer, Dr O’Brien said:

“[Ms P] continues to attend on a weekly basis and…has been medication free since late 2005, leading up to her current pregnancy…
Currently, [Ms] P continues to progress well…her major depressive disorder is in remission, but interestingly at the last review when doing a symptom check, [Ms] P did note that there were periods of poorer sleep and anxiety prior to the work days and at times a particular flatness in mood that was not explicable on the basis of current circumstances.
I have suggested to her that we need to pursue these subtle symptoms…since partial remission leaves her more severely at risk of relapse…
I am continuing to see P on a weekly basis…”

In that report, Dr O’Brien included a copy of a facsimile which was sent to her by Allianz on 24 July 2006. The facsimile asked Dr O’Brien for her “assistance with the management of the claim” and asked her to provide certain information. Dr O’Brien completed the form on 4 August 2006 as follows:

“Diagnosis:

Major Depressive Disorder – recurrent, of moderate severity, in remission. (DSM IV: 296.32).
Occupational Problem (DSM IV:v62.2).
Prognosis:
Psychotherapy…is progressing satisfactorily. Currently off medication due to pregnancy, with high risk of post-natal depression after delivery.

In your opinion, please detail Ms P’s capabilities/ability to work within the NSW Police Service:
Fit to work in current suitable duties [illegible]. Likely to relapse if working in front line, high risk or negotiation settings. Vulnerability to acute stress will remain a risk factor for relapse of depressive illness.
Current Certification
Fit for suitable duties full time (38hrs/wek).
What restrictions will be imposed on Ms P’s Return to Work (if any)?
Frontline and high risk work including negotiation work is contraindicated.
What type of treatment does Ms P still require?
Ongoing psychotherapeutic treatment on a weekly basis for 6 months, then reduction to once fortnightly then once monthly over course of 2007 is recommended. As stated earlier, because of high risk of post-natal depression [she] will require close monitoring after birth of child and will require re-institution of antidepressant medication if relapses in this period. Long term regular monitoring of mood/function and early [intervention?] if relapses.”

Dr O’Brien sent a report to Ms Jenny Aiken, Case Manager at Allianz on 8 August 2007. She made reference to the facsimile she sent on 4 August 2006 and added:

“The immediate prognosis for Ms P during the postnatal period remains one of a higher risk of the occurrence of postnatal depression given the past history of Major Depressive Disorder- recurrent, of moderate severity (DSM_IV 296.32). The transition from maternity leave back into the workplace will also…be a risk of recurrence. The negotiation through the postnatal period (12 months) and the return to work (3-6 months) will both be periods of higher risk of recurrence and will determine subsequent progress
Ms P is as noted due to return to work on 22 February 2008, and [her ability] to work…will remain as noted on the 4 August 2006 response: ’Fit to work in current suitable duties environment…
Ms P is apprehensive about returning to work, in an understandable way, given her new motherhood…
In terms of the clinical condition, obviously significant increased stress of an emotional, practical/occupational nature, remains a risk factor for Ms P…Ms P does note that contact with the insurer inevitably raises levels of anxiety because of the association with the early work injury and the long term sequelae of this in terms of recurrent depression. In the long term, Ms P remains at risk of further episodes of depression, both because of a genetic vulnerability but also because of the nature of the work and its association with the initial episode which was stress related…”

In a report dated 17 September 2007, again addressed to Ms Aiken, Dr O’Brien said:

“The following information is provided in light of developments in Ms P’s illness following the provision of a report to you on 8 August 2007.
The contents of that report were based on contact with Ms P following the birth of her child in March 2007…At [the] 20 July 2007 consultation, Ms P reported distress following contact from the insurer and the request for a report…
[Between] 20 July 2007 and 13 August 2007, Ms P had suffered a significant worsening in her mood state and appropriately sought review by…Dr Singer who supplied her a sickness certificate which was sent to your office.
Ms P was subsequently requested to undertake a consultation with psychologist, Mr Raymond Field and with Ms P’s permission, I spoke with Mr Field at his request following his consultation with Ms P.
In the discussion with Mr Field, I reported the sequence of events noted above and commented that Ms P’s mood state had deteriorated following contact with the insurer to such an extent that weekly consultations were reinstated from 13 August with a view to assisting her to deal with the recrudescence of her symptoms.
Of note is that in the appointments of 13 August, 20 August and 27 August, in reviewing the sequence of events leading up to and subsequent to Ms P’s deterioration, it was clear that elements in her symptomotology had emerged which had not been readily apparent in the past. In addition to significant mood lability, periods of distress and irritation, loss of confidence in managing her baby’s needs. poor sleep and anxiety, Ms P also made reference to her initial depressive illness in 1995 and the work stressors that led to this episode.
Ms P described intrusive and distressing recollections of the events of that time, including images of violence that she had encountered during that period in her workplace…Also Ms P reported intense psychological distress at contact with the insurer…
The above phenomena are suggestive of elements of a Posttraumatic Stress Disorder in addition to the long standing diagnosis of a Major Depressive Episode, recurrent…
In addition…I would be grateful if you would take note of the attached letter from Ms P in which she requests that any need to seek information on her medical condition be directed to her treating doctors rather than to herself. I would strongly endorse this request since it is apparent that contact with the insurer is a risk factor in the evolution of her illness.”

The letter from Ms P addressed to Dr O’Brien dated 23 August 2007 was attached. Ms P said:

“I have this week been contacted by Allianz Case Officers.
During the course of this phone call I was asked to comment on the status of my health and provide details of my injury re-occurrence. I found this inquiry extremely distressing and experienced high levels of anxiousness.
I do not feel comfortable discussing my medical condition over the phone in this manner. I indicated that whilst I understood my obligation to comply with providing as much information as possible to the insurer, given the nature of my psychological condition I believed it more appropriate for the information to be supplied from my doctor…”

In a handwritten report addressed to Dr Singer dated 10 December 2007, much of which is illegible, Dr O’Brien said:

“In my opinion, [Ms] P has [a] diagnosable PTSD and is not suffering from a secondary depression because of her own (illegible)…”

In a detailed report to Dr Singer dated 18 March 2008, Dr O’Brien repeated many of the matters raised in her earlier reports, but added:

“The work that she has undertaken psychotherapeutically since August 2007 has allowed for the recognition and addressing of elements of this post traumatic stress disorder that relate to the initial hurt on duty trauma in Bourke in 1995, with recurrence in 1996- triggered by an inquiry and court proceedings around the 1995 episode. The re-emergence of these symptoms and associated memories now impacted on P’s capacity to be emotionally available to her child and to modulate her mood function. Throughout these months, although [Ms] P has had symptoms of depressed mood, they have not been sustained enough to warrant a diagnosis of a recurrence of the major depression, but rather are associated understandably with the posttraumatic stress disorder domain.
Unfortunately, in keeping with posttraumatic stress disorder, exposure to cues that symbolise or evoke memories of the traumatic event induces marked distress on [Ms] P’s part both psychological and physical. As a result, I requested in my second report to the insurer that contact regarding [Ms] P’s well being be directed to her medical carers in the first instance rather than to herself to minimise the risk of this occurring…
It is unclear now whether [Ms] P will be able to return to work since the work setting is the stimulus for recrudescence in her posttraumatic stress disorder symptoms. It is also difficult adequately to treat the disorder when she is in the process of resolving her dispute with the insurer…”

In a report dated 22 December 2008, Dr O’Brien noted the existing diagnosis of “Major depression, unipolar, recurrent following a hurt on duty trauma in 1995” at the time she first saw Ms P in 2004, and that this had recurred at that time. She noted that symptoms had remained over the years with fluctuating severity. She said that in 2007 she “revised” her diagnosis to that of “Posttraumatic Stress Disorder resultant from the original injury, with an exacerbation in early 2007 after the birth of her child.” She concluded:

“In consultation with GP, Dr Singer, Ms P continues treatment for this condition which has rendered her unfit for work, with her most recent Medical Certificate attesting to her incapacity extant to 10 April 2009. In my opinion, Ms P is permanently incapacitated for work in any capacity as a police officer.”

In a report dated 2 April 2009 addressed to Ms Clay, the “Injury Management Advisor” to the Appellant, Dr O’Brien commented on the report by Dr Klaas Akkerman, consultant psychiatrist dated 18 March 2009, which was commissioned by the Appellant. Her comments were essentially confined to Dr Akkerman’s view that Ms P should try a further course of anti-depressants. Dr O’Brien disagreed.

Ms P chose herself to rely upon the report of Dr Akkerman in preference to her own qualified psychiatrist, Dr Klug. Dr Akkerman noted that liability had been declined based on the opinion of Dr Lee, and that Dr Singer had diagnosed Ms P as suffering from Posttraumatic Stress Disorder (PTSD). He noted:

“You included two reports, one by Dr Synott, a psychiatrist, dated 11 May 2005. He diagnosed her with dysthimic disorder. He did not diagnose [PTSD]. Dr Lee’s report was dated 31 October 2007. He was vague regarding diagnosis. He believed that she had a depressive disorder. He believed that it was quite possible that it was related to post-natal issues. He believed that she was exaggerating or feigning her condition.”

Dr Akkerman obtained the following history:

“She had problems with the bushfires in Sydney. This happened just before she was transferred to Bourke. She was assaulted by a civilian in a riot. There were riots for six months. There were managerial issues. She said she was asked to do inappropriate things that she would not do. She had three months off. She did not really have any treatment. She saw Dr Burke once.
She was then in Human Resources from 1995 to 1999. She was then in Special Crime and Internal Affairs up to 2002. She had 2002 off. She was then in State Protection for a year and returned to Human Resources up to 2007. She then went on maternity leave and has not returned since.
I enquired as to whether or not she has a psychiatric disorder. She believes that she does. She says that her symptoms started in 1994. She was at her worst in 2007…

I enquired as to what the worst stressors were. She was assaulted. Her weapon was taken off her. She was not believed. The second was that she arrived late at a person’s house who subsequently burnt to death. She saw her body. She was shot at.
I enquired as to what treatment she has had. She said that she saw Dr Michael Bowden…for 4 years. She has now been seeing Dr Elizabeth O’Brien for 5 years. She sees her weekly.”

Dr Akkerman described his findings on examination as follows:

“Her mood was depressed. Her affect was similar. Her concentration and short term memory were down. She was very tearful at times. She was irritable. She became upset when she described her distressful events. She used avoidance. She startled easily. She was hypervigilant.”

He concluded that she suffered from PTSD and Major Depression and that both these conditions were “caused by her work.” He considered her prognosis “very guarded, both currently and in the future.” He added:

“Currently she is not well. Currently she cannot work at all. I do not think that she will ever work with the Police Force in any way again. She cannot work in operational duties. She could not do an alternate role. The treatment she is receiving is appropriate. She would benefit from antidepressants. I have mentioned this to her.
In my opinion, she has suffered from [PTSD] since 1994.”

No report from either Dr Synott (to whom Dr Akkerman referred) or the psychologist, Mr Field (to whom Dr O’Brien referred) was in evidence. Both were consultations requested by the Appellant.

Interestingly, Dr Lee in his report of 31 October 2007 makes reference to a report from Mr Field. He also had some reports from Dr O’Brien together with a statement from Sergeant Comptom. He quotes from Mr Field’s report on comments by another of Ms P’s colleagues, Mr Craig Lawless. Ms P objected to the admission of this report but it was allowed into evidence “subject to weight but was not relied upon by [the Appellant] in submissions” (Reasons at [12]). The statement from Sergeant Compton was not in evidence before the Arbitrator. At the teleconference I had with the parties on 2 February 2010, neither party chose to admit it or rely upon it.

Dr Lee obtained a history of events in Bourke but also:

“She told me that following an event at work in 2003, she collapsed…and had a massive anxiety attack. She does not know if there was one specific event, but told me that she had worked in a high risk area for 11 years doing negotiating between 1992 until 2003.”

He was told by Ms P of her experience in 2003 of working as relieving Commander on call 24 hours a day, seven days a week and of difficulties she had with sleep, concentration, palpitations and anxiety during her time in Human Resources.

Dr Lee concluded:

“The evidence from two of her colleagues indicates that she had no significant psychiatric symptoms before going off on maternity leave, which however has to be contrasted with her report that she was requiring to consult Dr O’Brien on a weekly basis since 2004 apparently for what was believed to be a recurrent major depression.
On the balance of probabilities, given Sgt Compton’s report that she displayed no outward signs of psychiatric disorder and was apparently falsifying leave entitlements, and Dr O’Brien’s reporting that she was not complaining of flashbacks up until the challenging of her entitlements while she was on maternity leave, and given the SIRS documentation of highly unreliable reporting, the current condition is not consistent with [PTSD] injuries ascribed to Bourke in the 1990’s…
It is not entirely clear that Ms P actually suffered from major depression, or that if she did it was causally related to her employment… The fact that she was assessed…and the tests apparently found no evidence of ‘stress’ makes it appear likely that she was markedly exaggerating symptoms in 2003…
I note that Sergeant P was on maternity leave at the time of her apparent recurrence of psychiatric disorder. It appears to me from her presentation today that there is considerable exaggeration of psychiatric symptoms, although it has to be said that Ms P is reporting worrying signs that she feels she may become violent towards her child. I do not think that the injuries which are alleged to have occurred as a result of work associated incidents are consistent with her present condition, which may or may not be genuine…
As Sergeant P had been a police officer for many years, it seems unlikely that she would have been caused [PTSD] from being telephoned while on maternity leave with regard to discrepancies in her leave entitlements.
It has to be said that postnatal depression is a significant possibility if she genuinely suffers from a psychiatric disorder…”

Other Evidence

As I said earlier, the evidence submitted by Ms P was voluminous, and included extensive documents relating to, for example, proceedings following the incident in Bourke in 1994, leave applications over many years, and numerous letters and emails principally relating to apparent problems with the Appellant’s or Allianz’s auditing systems. This may in part be due to the Appellant’s “Notice under section 54 of [the 1987 Act]” sent to Ms P on 6 December 2007. The accompanying letter denying ongoing liability stated that the reason for this decision was:

“The present condition you are suffering from is not related to your work injury on 18/11/03 and you are not suffering a diagnosable psychological condition, nor a primary psychological condition, attributable to your employment…pursuant to sections 4, 9, 9A and 11A of the 1987 Act based upon the report of Dr Lee dated 31/10/07.”

The section 54 Notice added that documents relied upon were the reports of Dr Lee, a statement from Sergeant Compton, a statement from Helen Dalton dated 29 November 2007 and the reports from Dr O’Brien dated 8 August 2007 and 17 September 2007. It said:

“We are of the opinion your alleged psychological injury has arisen as a result of your erroneous misperception of errors in the leave audit undertaken by the NSW Police Force and that a case manager from Allianz TMF aggravated your condition. We do not believe that you can rely upon the decision in State Transit Authority of NSW v Chelmer [sic-Chemler] (2007) NSWCA 249 to preclude a ‘misperception’ argument, as you have misperceived what actually occurred with both these events.
We are of the opinion that your alleged psychological injury wholly or predominantly manifested as a result of the reasonable actions taken by your Insured in conducting an internal audit into your leave records, which falls under the provisions of performance appraisal and the provision of employment benefits. Accordingly, liability is declined pursuant to section 11A of the Act.”

Although all sections of the 1987 Act referred to in the section 54 Notice were put in issue, ultimately, the issues in dispute were essentially confined as to whether the employment was a substantial contributing factor to the “aggravation” injury the Appellant conceded, and whether the claim failed because of the operation of section 11A.

In these circumstances, I do not propose to consider all the other evidence in detail, but some reference to it is appropriate.

Ms P included lengthy statements from her husband and former husband, her mother, and police officers Abel, Hodson, McKenna, Johnston, Ball and Langford. As the Arbitrator noted, Detective Hodson was critical of some of Sergeant Comptom’s comments, stating that Ms P often appeared stressed and anxious (paragraph 39) and that she was meticulous in her record keeping (paragraph 55). Detective Hodson added: “Continual mistakes made by the organisation and its systems along with the over zealous actions of the insurance company I believe have affected the health of P.” Senior Sergeant Gayle Johnston in her statement of 11 September 2008 noted that she had first met Ms P in 1995 when she was her supervisor and was “aware that she was on restricted duties and she was taking medication…” She also noted that: “P would become upset and agitated when there were mistakes made in the recording of leave entitlements…Because of the sort of person she is, she kept copies of everything to prove that what she was presenting was correct. On one occasion I remember that she forwarded the same documents through three times. I believe that part of the problem with Alliance (sic) and other Insurers is the turnover of staff. This also happened within our own command.”

Some of the contents of these various statements were referred to by the Arbitrator at [34-35] of his reasons where he concluded at [35]:

“I note that these comments by Senior Sergeant Johnston support the views of Inspector Hudson (sic) about the somewhat obsessive behaviour of Sergeant Compton. They also provide further independent support for what clearly was an inadequate and stressful system of dealing with leave and other entitlements in the Police Force.”

In its Reply, the Appellant included a statement from Helen Dalton, the general manager of HR Services, dated 29 November 2007 wherein she claimed that Ms P would frequently fail to follow instructions, generally as to who to contact and the procedure to be followed in order to claim any entitlements.

Other material tendered by Ms P included details of benefits paid by the GIO over the years, and numerous “Time Lost Reimbursement Schedules” she had submitted to Allianz. Records disclose that she was reimbursed by Allianz at least up until 24 November 2007. She also included a number of medical certificates from Dr Singer. One dated 16 February 2006 did not comment on her capacity for employment, but certified that she required “weekly treatment by psychiatrist Dr O’Brien” for the period 16 February 2006 to 16 February 2007. Following the incident in June 2007, Dr Singer certified Ms P as unfit for work.

Following my teleconference, the Appellant confirmed by letter to Ms P’s solicitor dated 9 February 2010 that at the time she commenced maternity leave, Ms P “was not employed in front line policing duties, but was employed…in an administrative role with the Human Resources Command…” This is consistent with the certification from Dr Singer referred to above that Ms P still required ongoing weekly treatment.

THE SUBMISSIONS AND DISCUSSION

The ‘Injury’ Issue

At the outset, I should say that many of the supplementary submissions filed by the parties following the teleconference go beyond the bounds of the information I sought. The Appellant also complains that Ms P has further commented upon matters not specifically the subject of appeal. I have noted these submissions, but my task on review as Spigelman CJ said in State Transit Authority of New South Wales v Fritzi Chemler [2007] NSWCA249 (‘Chemler’) is:

“to decide whether the original decision is wrong, or, as it is often put in the context of administrative appeals on merits, must decide what is the true and correct view.”

The Appellant submits that it does not cavil with the Arbitrator’s finding that the injury on 26 June 2007 is one that falls to be determined under section 4(b)(ii) of the 1987 Act, but says that the Arbitrator erred in finding that employment was a contributing factor to the aggravation.

Ms P submitted before the Arbitrator that her injury was essentially a continuance of her diagnosed PTSD, which was co-morbid with her Major Depression, and relied upon the opinion of Dr Akkerman to this effect, and that of Dr O’Brien.

The Arbitrator dealt with this issue commencing at [17]. He concluded, commencing at [38] as follows:

“38. Ultimately, in circumstances where injury was admitted, the Respondent relied on Dr Akkerman’s Report and the Report of Dr O’Brien for the Applicant as establishing aggravation. The Applicant argued that both indicated that the real medical condition was Post-Traumatic Stress Disorder affected by ‘triggers or cues’ not aggravation.
39. Realistically, says the Applicant, she was in maintenance mode rather than “in remission” notwithstanding the use of that phrase by Dr O’Brien in her letter of 8 August 2007, which preceded her Post-Traumatic Stress Disorder analysis in her Report dated 18 March 2008.
40. The decision relied upon by the Applicant in submissions was S v State of New South Wales [2009] NSWCA 164 (‘S’). The Applicant did not refer me to any particular paragraph in this decision which was largely taken up with what was in fact an unnecessary concession by the Respondent as to the Applicant’s then psychological condition.
41. As I understand the Applicant’s submissions however, they were to the effect that S supports the Applicant’s contention that this is not a case of aggravation but of Post-Traumatic Stress Disorder being a ‘rumbling condition’ including movements and sub-memories of traumatic events which can be brought forward by cues or triggers….
43. I have not referred to all of the submissions of the parties with regard to their individual analysis of the Medical Reports but on my reading, S is more about ‘the straw that broke the camel’s back’ than that portion of Federal Broom which is authority for the fact that acceleration has occurred where there is:

‘More severe or additional symptoms arising from the acceleration which have produced an incapacity which would not otherwise have existed’.

44. Dr O’Brien herself uses the phrase ‘emerging symptoms’ and it is clear that what appears to have been an unfortunate telephone call on 26 June 2007 has resulted in ‘an incapacity which would not otherwise have existed’.

45. The Respondent submits that even if symptoms had been present previously, even if they had been misdiagnosed, this is still an example of aggravation and that the final sentence in the extract from Dr O’Brien’s Report dated 18 March 2008 (see Paragraph 32 hereof) illustrates this.
46. Having considered the submissions of the parties, I find that on the balance of probabilities, this is an example of aggravation to which Section 4(b)(ii) applies and as dealt with in Federal Broom.
47. Whilst the Respondent has asserted that the aggravation did not arise ‘in the course of employment’, it appears clear to me that it was an ‘injury arising out of or in the course of employment’ [Section 4(a)].”

Was the Arbitrator’s approach as to the issue of ‘injury’ correct?

There was certainly some evidence in support of his conclusion that the ‘injury’ was in the nature of an aggravation of a pre-existing condition. The basis upon which he stated that “injury was admitted” by the Appellant is not entirely clear. Was he referring to the various incidents relied upon by Ms P as causing her ‘injury’, or merely the telephone call in June 2007? For a finding of injury under section 4(b)(ii), there must be evidence of the primary “disease” which has been aggravated by the employment. The Appellant certainly conceded that Ms P suffers from a psychiatric condition, and that it was a “disease” within the meaning of the Act. As I understand it, the Appellant’s argument was essentially that Ms P had not established that her employment was “a contributing factor” to the aggravation, and that the circumstances surrounding the phone call in June 2007 did not occur “in the course of employment.”

The alternative approach is that, as Dr Akkerman opined, Ms P currently suffers from PTSD and major depression “caused by her work” namely, the incidents she described at Jannalli, at Bourke and subsequently, and that the telephone call in June 2007 caused her existing ‘injury’ to deteriorate such that her incapacity can be said to “result from” those initial injuries. In other words, as Ms P submitted, her condition was “rumbling” and could be brought forward by cues or triggers, in line with the decision in S. This approach is also consistent with the evidence that for at least 12 months prior to the maternity leave, Ms P was attending Dr O’Brien weekly for treatment, and liability for this had been accepted by Allianz. It also lends support to Ms P’s argument referred to by the Arbitrator at [39] that she was in effect in “maintenance mode” rather than remission, notwithstanding Dr O’Brien’s use of this term.

Although I acknowledge that Dr Akkerman did not obtain a history of the incident in June 2007, his opinion is supported by the ‘revised’ opinion of Dr O’Brien, which she made following consultations with Ms P after the June 2007 incident, and also that of Dr Singer.

In my view, those opinions are persuasive. As the Arbitrator noted, the Appellant did not rely upon the opinion of Dr Lee in its submissions, focussing instead on the issues to which I have referred at [103] above.

I am reinforced in my conclusion for a number of reasons. Firstly, Ms Aiken’s initial call to Ms P in June 2007 was, according to Ms P, about her “current certificate and medical status.” In other words, it related to the accepted psychiatric condition Ms P was continuing to suffer as a consequence of earlier events. The discussion about leave entitlements similarly related to that condition. The evidence discloses that she had been reimbursed for such absences in the past. In other words, those absences related to events occurring prior to the phone call in June 2007. Without the existence of the earlier injuries, and the consequential claim for entitlements, there was no reason to call Ms P.

Secondly, liability had been accepted by the GIO and subsequently Allianz in the past, and it was not disputed that Ms P remained on “restricted duties” namely non front- line policing, consequent upon her past ‘injuries’ at the time she commenced maternity leave.

Thirdly, Ms P had regular treatment from Dr O’Brien since 2004. She took over from Dr Bowden whom Ms P had seen on a few occasions in the past. There is clear evidence that those visits were, at least throughout 2006, on a weekly basis. That treatment clearly related to earlier events.

Fourthly, the consensus of medical opinion is to the effect that Ms P suffers from Major Depression and PTSD, the latter a condition consequent upon her exposure to trauma, such as those events she described in her statement, and to Drs O’Brien, Akkerman and Lee.

Similar issues were considered by the High Court in Calnan v Commissioner of Police [1999] HCA 60 (‘Calnan’). In that case, the worker was advised that he was to be transferred from Newcastle to Sydney. He claimed that as a consequence of that decision, his underlying anxiety state was aggravated. The Tribunal found that he had been suffering a disease in the nature of an underlying anxiety disorder contracted in the course of his employment and to which his employment as a police officer was ‘a contributing factor’. The Tribunal identified the sole factor, which contributed to the exacerbation to be the decision to transfer him to Sydney, but that the decision to transfer him was not an event which occurred in the course of his employment as a police officer. The claim was rejected.

The High Court said at [37-38]:

“The finding that the underlying disease was contracted in the course of employment and that the appellant's employment was a contributing factor was sufficient to bring the matter within the meaning of ‘injury’ in s 4(b)(i) of the Workers Compensation Act. Whether the particular occasion for the absence from work was triggered by an event within, or outside, the appellant's employment was irrelevant.
Once the appellant established that his underlying anxiety disorder was an injury within the meaning of the Workers Compensation Act, he was entitled ‘to compensation ... under [that] Act’ [16] upon proof that his total or partial incapacity for work resulted from that injury [17]. The question then for the Tribunal was whether the appellant’s incapacity was causally connected to the underlying anxiety disorder. It has long been settled that incapacity may result from an injury for the purposes of workers' compensation legislation even though the incapacity is also the product of other - even later – causes [18]. Indeed, death or incapacity may result from a work injury even though the death or incapacity also results from a later, non-employment cause. Thus, in Conkey & Sons Ltd v Miller, Barwick CJ, with whose judgment Gibbs, Stephen, Jacobs and Murphy JJ agreed, held that it was open to the Workers’ Compensation Commission to find from the medical evidence in that case ‘that the death by reason of myocardial infarction when it did ultimately occur, “resulted” from the work-caused injury of the first infarction, even if it could not be said that the final infarction was itself caused by work-caused injury’ [19].”

In the present case, Ms P’s PTSD and Major Depressive Disorder was an injury occurring in the course of her employment, and her employment was a contributing factor to this condition. Contrary to the Arbitrator’s finding, having carefully considered all of the evidence, I have concluded that her injury fell within the definition of ‘injury’ within section 4(b)(i) of the 1987 Act in line with Calnan. The question to then consider is whether her incapacity is causally connected to this ‘injury’, having regard to the provisions of sections 9A and 11A of the 1987 Act.

Most of the Appellant’s submissions on the ‘injury’ issue are directed at the question as to whether the employment was a contributing factor within the meaning of section 4(b)(ii) with reliance on decisions such as Cook v Midpart Pty Ltd t/as McDonalds Forster & Anor [2008] NSWCA 151 and Badawi v Nexon Asia Pacific Pty Ltd t/as Commander Australia Pty Ltd [2009] NSWCA324 (‘Badawi’). In short, the Appellant submits that the event giving rise to the “aggravation” was not in any way connected with Ms P’s employment such that her claim must fail. Having determined that Ms P’s injury was more properly characterised as one falling within the definition of section 4(b)(i), that is, a disease in the nature of PTSD, and that her incapacity which arose following the incident in June 2007 resulted from that condition, it is not strictly necessary for me to consider the Appellant’s submissions on this issue. But if I am wrong in my approach, then some comments are appropriate.

Although the Appellant argued that the telephone call in June 2007 could not be said to have arisen “in the course of her employment,” it clearly was an incident “arising out of” her employment (see Angeli v CIC Workers Compensation (NSW) Ltd (1994) 10 NSWCCR 163). In this regard, the Appellant’s reliance on the observations of Windeyer J in Federal Broom Co Pty Ltd v Semlitch [1964] NSWR511 (‘Federal Broom’) that the telephone call was not “in the course of the employment or some characteristic of the work performed or the conditions in which it was performed” is misconceived. Section 4(a) defines ‘injury’ as “personal injury arising out of or in the course of employment.” That is the primary definition. Such an injury includes injury by way of a disease or an aggravation of a disease where the employment is a contributing factor.

It is then necessary to consider the impact of sections 9A and 11A.

The Section 9A Issue

As the Appellant quite rightly points out, section 9A requires independent consideration over and above section 4 of the 1987 Act.

The Arbitrator dealt with this issue commencing at [48] as follows:

“48. The Respondent says that the call from the Insurer was not a substantial contributing factor to the Applicant’s injury and again relied upon the Applicant’s Statement at Paragraphs 222 to 224.
49. Taken alone, a telephone call from an Insurer (even though arising out of employment) to a Worker on maternity leave and who has not returned to the workplace may not immediately appear to satisfy Section 9A.
50. In the context of this matter however, there was a long history of debate about the Applicant’s leave entitlements. I am satisfied on the evidence that that debate arose mainly from two sources being:
a. An unreasonable attitude adopted by Sergeant Compton, as indicated by the evidence of Inspector Hudson and Sergeant Johnson, for reasons that are not really apparent.

b. The inadequate record keeping of the Respondent (and/or the Insurer), which appears not to have been up-to-date and which may have given some comfort to Sergeant Compton in arriving at his views which are not supported by others but which inconvenienced the Applicant.

…

53.    Against this background, the Insurance Company’s representative (the Applicant’s account not having been contradicted) appears to have asked a number of probing questions and at one stage, challenged the accuracy of the Applicant’s information as to which command she was attached to.
54.    In assessing therefore whether employment was a “substantial contributing factor” to this aggravation, it is not sufficient to take the Insurer’s inquiries in isolation but as part of an ongoing failure by the Respondent to deal with the Applicant’s entitlements in a satisfactory manner. They clearly need to be considered in context of the Applicant’s struggle to obtain/ clarify her leave entitlements over a period of years.
55.    The Respondent having succeeded on aggravation, it is also more difficult to argue that the telephone call/ aggravating factor was not also a substantial contributing factor.
56. Taken in the overall context of the Applicant’s employment history, the aggravation suffered by her was substantially contributed to by her employment and the Applicant has therefore satisfied the requirements of Section 9A.”

The Appellant submits that the Arbitrator’s finding under section 9A conflicts with his finding of an injury by way of aggravation, pointing specifically to paragraphs [53-54] of his Reasons. In the Appellant’s submission, it was the incident on 26 June 2007 “that allegedly led to incapacity…” and that, on Ms P’s evidence, the call was directed to her claim for travel expenses and “did not relate to the pre-existing history, nor the audit of her leave.”

It is appropriate to look at Ms P’s evidence on this issue, commencing at [222]–[224] of her statement. She said:

“222. On the afternoon of 26 June 2007 Jenny Aiken…contacted me. Since I had supplied a claim on 24 May 2007 for the recoup of travel expenses I assumed the phone call was in relation to this matter. Jenny commenced to ask a number of questions about my current certificate and medical status. She appeared to be surprised to learn I was on maternity leave and asked if I was still being treated by my doctor. Jenny wanted to know why I was still being treated and how often I was going to see Dr O’Brien. I indicated that whilst I had seen Dr O’Brien weekly prior to maternity leave, the treatment I was receiving was being monitored and assessed on each occasion. Jenny asked what type of treatment was being conducted. I specified I was undergoing Cognitive Behaviour treatment. She asked if I found this ‘helpful’. I found myself becoming quite anxious and replied yes…
223. Jenny Aiken proceeded to ask: ’What’s happening at work?’ Not knowing what she meant, I sought to clarify this to which she replied: ‘Well who would I speak to at State Crime Command (SCC), you’re at [SCC]’. I stated that I had never been attached to SCC and worked at HR. Jenny tried to dispute this and I assured her I would have known if I had worked at SCC. She then asked when I was returning to work and I told her September. I then enquired about the recently submitted travel claim only to learn that they had once again ‘lost the papers’. Jenny asked who my boss was at HR so she could ring and discuss my matter. I replied given the state of HR I had no idea who my manager was now the command had been restructured…Jenny asked sarcastically if I wanted to take on the employer’s responsibility for managing my claim…As the call progressed I found myself having difficulties breathing and feeling pins and needles along the side of my face. As I began to speak I was forcing myself to remain calm even though I could feel I was having heart palpitations…I said that I found it confusing and frustrating that a phone call would be initiated 9 months down the track after the last contact, and the Insurer didn’t know where I worked within the Police, my work status and once again had ‘lost’ my papers. As I was speaking I could hear typing…and I asked Jenny if she was actually listening to what was being said. Jenny replied that I was required to provide this information to the Insurer and she said she ‘expected to be treated with respect.’
224. At this point…I lost any control that I had. The build up of anxiety and frustration I had experienced as we spoke exploded into rage. I have no real recollections of the dialogue that took place, knowing only that I was yelling down the phone saying that this had been going on for years the sleeplessness, the everyday numbness, the depression and the anxiety. I questioned that sitting behind a desk she had no idea about being in riots in Bourke, dragging people out of burning houses, being shot at, assaulted, had star pickets swung at their head, had every manner of bodily fluids thrown at them all in the course of policing work only to have the insurance company dispute liability every step of the way…I was physically upset and crying uncontrollably…I felt as [if] everything that ad happened at Bourke was happening again…”

The statement of Helen Dalton to which I referred earlier confirms to some extent certain changes that occurred in the HR department relating to claims procedures.

Contrary to the Appellant’s assertion, the phone call from Ms Aiken was not about travel claims as Ms P had assumed, but clearly about matters relating to her earlier claim and ongoing entitlements.

Having already determined that the injury more properly fell within the definition of section 4(b)(i), in my view the phone call from Ms Aiken was directly related to matters arising from that ‘injury.’ The consequences of that call resulted in an increase in the symptoms associated with the injury. The injury, PTSD and Major Depression, arose out of and in the course of employment, and there was ample evidence to conclude that the employment was a substantial contributing factor to that injury.

Again, most of the Appellant’s submissions on this issue focus on the Arbitrator’s finding that the injury was by way of aggravation, and the phone call was neither an incident related to Ms P’s employment, nor was ‘employment’ a substantial contributing factor to that event “causative of injury.” Having found on the issue of ‘injury’ as I have, again, these submissions are to some extent not relevant, but again, if I am wrong in my approach, some comment is nonetheless appropriate.

The Appellant submits that the Arbitrator failed to carry out “a full and proper examination” of section 9A having regard to the matters set out in section 9A(2) and makes the following points:

“1.     The time and place of injury, being the worker’s home when on maternity leave are not supportive of employment being a substantial contributing factor.
2.   The nature of the work performed…being administrative duties…were not the cause of psychological consultations in early 2007 and had no effect on the…aggravation injury in June 2007.
3.     The duration of employment is irrelevant in circumstances where Dr Bowden noted depression related to familial issues as early as 2003(sic-1993)…
4.   The probability that the injury or a similar injury would have happened anyway…is high given the evidence of:
a. Dr Bowden that depression was present prior to any work –related concerns as early as 1993, and
b. Dr O’Brien’s evidence…that treatment in early 2007 was actually directed to prevention of postnatal depression…

5. The worker’s state of health before the injury…again, on the evidence of Dr Bowden, was of depression related to familial issues in 1993…Dr O’Brien opined depression was in full remission as at 2006…It is submitted that…any alleged work-related stress was not causative and that [Ms P] relapsed after disruption of her life and routine following childbirth.”

The Appellant adds that:

“On [Ms P’s] own evidence the reason for that phone call was continuing psychological treatment following the birth of [her] child…It was the disorganisation of [Ms P’s] life and the increased pressures of childbirth that are in fact the substantial contributing factors responsible for psychological distress…”

The Appellant has both misstated the evidence and misconceived the operation of section 9A for a number of reasons as follows:

· Dr O’Brien wrote to Allianz on 24 July 2006 alerting the insurer to the “high risk” of the development of post natal depression because of her existing work related condition, at that stage diagnosed as “Major Depressive Disorder” and “Occupational Problem.” She added: “Vulnerability to acute stress will remain a risk factor for relapse of depressive illness.”
· Notwithstanding any familial stresses in 1993, Dr Bowden concluded that Ms P’s depressive illness was directly related to the work stressors she described. Liability was accepted by both GIO and Allianz for many years thereafter.

· Although Dr O’Brien referred to Ms P as being in “remission” in 2006 she nonetheless noted “some minor symptoms of poorer sleep and anxiety prior to work days which warranted attention.” (my emphasis) This is consistent with the documented ongoing weekly treatment regime, and with Ms P in effect being in “maintenance mode.”
· The evidence disclosed that Ms P was having regular treatment from Dr O’Brien since 2004, well prior to her maternity leave.

· The evidence disclosed that Ms P saw Dr O’Brien weekly up until the birth of her child in March 2007, but did not return to see Dr O’Brien until 4 June 2007. Thereafter, she appears to have resumed fortnightly treatment as Dr O’Brien had anticipated in her earlier reports. There was no evidence to suggest that Ms P did in fact suffer from postnatal depression. It was in consultations in July 2007 following the phone call from Ms Aiken and thereafter that her condition deteriorated, and Dr O’Brien subsequently revised her diagnosis.

· Other than Dr Lee (whose diagnosis was vague in any event), neither Dr Akkerman nor Dr O’Brien, both aware of the pregnancy, considered that postnatal depression was causative of the deterioration in Ms P’s condition.

· Ms Aiken initiated the phone call clearly enquiring about matters other than travel expenses.

Even if the injury were to be construed as an ‘aggravation’ as the Appellant asserts, in all these circumstances, and for the reasons I have discussed earlier, I am satisfied that the employment was a substantial contributing factor to any such aggravation. Although I acknowledge the observations by the Court of Appeal in Badawi that when the Act speaks of “the employment” as a contributing factor it refers not to the fact of being employed but to what the worker in fact does in his employment, the circumstances of Ms P’s claim fit squarely with the remarks of Basten JA at [11]:
“If the conduct out of which the injury arose occurred in the course of employment and was the effective cause of the injury, absent misconduct on the part of the employee, the only conclusion reasonably open is that the employment was a substantial contributing factor to the injury.”
In this case, Ms P was still employed by the Appellant. She was on maternity leave. She had an acknowledged existing psychiatric disorder to which her employment was a contributing factor. The ‘aggravation’ arose in circumstances connected with that primary condition, that is, Ms Aiken’s telephone call. The conduct out of which the injury arose in effect occurred in the course of employment, and the only conclusion reasonably open was that the employment was a substantial contributing factor to her injury.

The Section 11A Issue

Having determined that Ms P’s ‘injury’ was one which fell into the category of section 4(b)(i), that is, PTSD consequent upon earlier events, it follows that her ‘injury’ cannot be said to be one that was wholly or predominantly caused by reasonable action taken by or on behalf of the employer with respect to, in this case, the provision of employee benefits. But again, if I am wrong in my approach, some comment is necessary.

The Appellant has set out in some detail the statutory obligations imposed upon insurers in the management of workers compensation claims, and submits that the Arbitrator’s findings on this issue are in direct conflict with the provisions of section 43 of the 1998 Act. In short, the Appellant submits that insurers are required under that Act “to directly contact an injured worker in management of the claim.”

The terms of section 43 are not in dispute, nor are the relevant “WorkCover Guidelines for Claiming Compensation Benefits” to which the Appellant refers.

The issue here is whether the conduct of the insurer within the meaning of section 11A is “reasonable.”

The question of whether the action is reasonable is one of fact involving an objective test relevant to the circumstances of each particular case. (See Commissioner of Police v Minahan [2003] NSWCA 239).

The Arbitrator dealt with this issue commencing at [57]-[63] as follows:

“57. As regards this Section, the Respondent asserts that if unsuccessful in arguing that the current injury is not work-related and substantially contributed to by it, then it is clear from Paragraph 222 of the Applicant’s Statement onward that the injury was “wholly or predominantly caused” in connection with an employment benefit with the result that the Respondent can rely upon Section 11A(1) and no compensation is payable.

58. The relationship between Section 9A and Section 11A was considered by the Court of Appeal in Department of Education and Training v Sinclair [2005] NSWCA 465 (2005) 4DDCR 206 (‘Sinclair’) where Spigelman CJ concluded that:
‘To avoid the absurdity that arises from a literal approach, and having regard to the context of the legislative scheme and its purpose, it is necessary to understand Section 11A to mean that the employer is not liable where, to the extent that the employment contributed to the injury, that contribution was wholly or predominantly caused by reasonable action taken with respect to discipline’

59.    In Delta Electricity v Healey [2006] NSWWCCPD 143, Candy A-DP was of the opinion, consistent with Sinclair, that the onus of satisfying the requirements of Section 9A is on the worker and the onus in relation to Section 11A is on the employer. The Acting Deputy President said if the circumstances of the injury are found to satisfy Section 9A and are on the evidence, the only cause of the claimed injury, by way of aggravation then, necessarily, that aggravation is wholly or predominantly caused by action taken by the employer.
60. Action so taken must of course also be “reasonable action” for the Respondent to be able to rely upon Section 11A.
61.    It may have been reasonable, notwithstanding the poor record keeping, for the Respondent/ its Insurer to contact the Applicant to update her details.
62.    The Insurer however knew that the Applicant was suffering from a psychological injury. In all the circumstances, dealt with at Paragraphs 222 to 224 inclusive of the Applicant’s Statement which is uncontested, the attitude taken by the Insurer was not reasonable.
63.    The Respondent has not established that the Applicant’s injury was wholly or predominantly caused by reasonable action taken with regard to the Applicant’s employment benefits.”

The Appellant’s submissions on this issue essentially fall into four categories as follows:
a.The adequacy of the Arbitrator’s reasons;
b.Ms P’s own conduct;
c.The conduct of the insurer and its obligations, and
d.The Arbitrator’s consideration of the “wholly or predominantly and “provision of employment benefits” provisions of section 11A.

To begin with, I accept the Appellant’s submission that the Arbitrator’s reasons were insufficient on this point, particularly his rather oblique reference to the insurer’s “attitude.” I propose to deal with this issue shortly when considering the other grounds of appeal.

Section 11A(1) provides as follows:

“No compensation is payable under this Act in respect of an injury that is a psychological injury if the injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by or on behalf of the employer with respect to transfer, demotion, promotion, performance appraisal, discipline, retrenchment or dismissal of workers or provision of employment benefits to workers.”

Dealing with Ms P’s own conduct, the Appellant submits that a review of her own statement reveals that she was aware of the insurer’s role, she had regular contact with the respective insurers in the past, that she had taken a “proactive approach with insurers” and that this conduct is evidence of her familiarity with “the workers compensation claims management process…” The relevance of this point is not entirely clear, but it seems to be made in the context of the Appellant’s submission that on 26 June 2007, “despite emerging symptoms, the worker did not advise that claims officer of any difficulties she was having.”

With all due respect to the Appellant, that is a rather naïve approach. The same must be said of the Appellant’s submission that there is no evidence that Ms Aiken knew of Ms P’s “difficulties.” If she did not know, she ought to have known since perusal of her file no doubt would have disclosed the detailed fax from Dr O’Brien sent to Allianz on 24 July 2006 to which I have referred earlier.

Similarly with the Appellant’s submission relating to the letter from Ms P dated 23 August 2007 attached to Dr O’Brien’s report to Ms Aiken of 17 September 2007, which followed a conversation with Ms Aiken on 21 August 2007. The Appellant submits: “That correspondence reveals that it was not the ‘attitude’ of the insurer to which she took exception, but the requirement of having to respond to medical questions posed in the course of claims management.”

In short, the Appellant submits that Ms P’s statement at paragraphs 222 to 224 reproduced above “does not disclose evidence sufficient for the Arbitrator to have found the attitude of the Insurer unreasonable.”

The Appellant’s submissions as to the conduct of Ms P miss the point. The Arbitrator in fact at [61] found that it may have been reasonable for Allianz to have contacted Ms P “to update her details.” But applying an objective approach to the facts and circumstances of this case, he concluded that the insurer’s conduct was not “reasonable”.

As to the conduct of the insurer, I have already acknowledged and accepted its obligations in relation to claims management. The Appellant submits that the Arbitrator “ought not to have placed any (or any significant) weight” on Ms P’s claim that Ms Aiken spoke to her “sarcastically” and that it was not open to the Arbitrator to find that the Appellant “acted in a ‘sarcastic’ manner.”

I am not persuaded that the Arbitrator in fact made such a finding. He merely stated that the “attitude taken by the Insurer was not reasonable.” I have already said that this statement is insufficient, but read in context, it appears to me that the Arbitrator was referring to the whole subject matter of Ms Aiken’s call, not just Ms P’s interpretation of it.

That being said, I also accept the Appellant’s submission that: “Even if it is accepted that an isolated comment was made in a sarcastic fashion, which is disputed, same is insufficient to tar the Insurer’s conduct as unreasonable.” As the Appellant points out, as Spigelman CJ said in Sinclair:

“His Honour’s analysis, as that of the Arbitrator, appears to assume that any specific blemish in the disciplinary process, however material in a causative sense or not, was such as to deprive the whole course of conduct of the characterisation ‘reasonable action with respect to discipline.’ In my opinion, a course of conduct may still be reasonable action even if particular steps are not.”

As I understand it, the Arbitrator was more critical of the nature and content of the phone call, rather than any allegedly sarcastic or derogatory remarks made by Ms Aiken. What certainly appears to be uncontested is that there were indeed problems with the Appellant’s and Allianz’s administration relating to claims management. Ms P’s complaints as to the difficulties she experienced in the prompt and proper administration of her claim is supported by Detectives Hodson and Johnston, and to some extent, Ms Dalton.

Ms Aiken did not give evidence. The Appellant submits that no adverse inference should be drawn, and refers to the observations of Heydon J in HML v R [2008] HCA 16 as follows:

“In civil cases the unexplained failure of a party to give evidence, call witnesses or tender material is not treated as evidence of fear that it would expose an unfavourable fact, nor as an assertion of the non existence of the fact not proved: the only consequence is that the failure can cause an inference arising from the evidence of the opposing party to be more confidently drawn.”

I accept to an extent the Appellant’s submission. No adverse inference should be drawn from Ms P’s perception of remarks made by Ms Aiken. However, the general substance of the call has not been challenged, in particular, Ms P’s assertions as to questions about her work, expenses, and the nature and extent of treatment. If this was seriously in issue, it might have been expected that some evidence from Ms Aiken would have been obtained.

In considering the reasonableness or otherwise of the insurer’s actions, I have had regard to a number of authorities on this issue, in particular, Buxton v Bi-Lo Pty Ltd (1998) 16NSWCCR234 and Ritchie v Department of Community Services (1998) 16 NSWCCR 727 in terms of how a ‘reasonable observer’ would have viewed the action. In the normal course of events, as the Arbitrator noted, it would be reasonable for an insurer to contact a worker. But given Ms P’s well documented psychiatric history, and in particular Dr O’Brien’s clearly stated concerns that Ms P was vulnerable to a relapse if placed under stress, in my view the actions of the insurer in the circumstances of this particular case were unfair, and a reasonable observer would find the action unreasonable.

This is by no means a criticism of the insurer’s entitlement to contact Ms P: the phone call was perhaps best described as unfortunate in the circumstances, but the consequences were significant, and for the reasons stated, the insurer ought to have been aware of this.

As to the Appellant’s final point on this issue, it is clear that Ms P’s ‘injury’ which I have concluded fell within the definition of section 4(b)(i), was not “wholly or predominantly” caused by reasonable action on the part of the insurer. The incapacity which clearly flowed from the incident in June 2007 was in part due to the insurer’s actions, but principally an ongoing consequence of the underlying PTSD and Ms P’s vulnerability to relapse because of it (see the reports of Dr O’Brien and Ms P’s statement).

Finally, I am not persuaded that the phone call was in fact wholly related to “the provision of employee benefits.” It was initiated by Ms Aiken apparently to determine Ms P’s current medical status. I do accept that it was perhaps in part due to the provision of employee benefits, but nothing turns on this for the reasons stated.

The Adequacy of Reasons Issue

I have already accepted the Appellant’s submission that the Arbitrator’s reasons in relation to the section 11A issue were insufficient and failed to satisfy the test enunciated by Mahoney JA in Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247.

Commission Arbitrators have a statutory obligation to provide adequate reasons for a decision. But the effect of any deficiency in this regard is to some extent overcome by my powers on review. In the present case, because of my findings on the issue of ‘injury’, the impact of section 11A was of no consequence but as I said, even if my approach was wrong, the Arbitrator’s conclusions on this issue were correct, notwithstanding his failure to provide a sufficient explanation for his reasoning.

Thus nothing turns on this ground of appeal.

CONCLUSION

Having conducted a review on the merits (per Spigelman CJ in Chemler) I have concluded that Ms P’s ‘injury’ falls within the definition of section 4(b)(i) of the 1987 Act, and that the incapacity which arose subsequent to the insurer’s phone call to her on 26 June 2007 directly results from that injury. In the absence of any challenge to Ms P’s monetary entitlements, she is entitled to the award as determined by the Arbitrator.

DECISION

The decision of the Arbitrator dated 18 September 2009 is confirmed.

COSTS

The Appellant is to pay the costs of the appeal.

Deborah Moore
Acting Deputy President
15 March 2010

I, TUYET WALLIS CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF DEBORAH MOORE, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.

ASSOCIATE