Payne v Shellharbour City Council

DETERMINATION OF APPEAL PANEL
CITATION:	Payne v Shellharbour City Council [2022] NSWPICMP 99
APPELLANT:	Phillip Payne
RESPONDENT:	Shellharbour City Council
APPEAL PANEL:	Member William Dalley Dr James Bodel Dr Mark Burns
DATE OF DECISION:	2 May 2022
CATCHWORDS:	WORKERS COMPENSATION- Allegation of error with respect to history relied upon by the Medical Assessor (MA) as to the opinion of two treating specialists with regard to the requirement for knee replacement prior to the subject injury; the MA deducted one half pursuant to section 323 of the Workplace Injury Management and Workers Compensation Act 1998 ; Held- error in respect of the chain of reasoning was established; it was arguable that the deduction assessed would be open upon the basis of the radiological evidence before and after the subject injury, but the MA had referred to the incorrect history as “strong evidence” supporting his view; upon review Medical Assessment Certificate revoked and a deduction of 2/5 was substituted.

BACKGROUND TO THE APPLICATION TO APPEAL

On 20 January 2022 Philip Payne (the appellant) lodged an Application to Appeal Against the Decision of a Medical Assessor. The medical dispute was assessed by Dr You-Key Ho, a Medical Assessor, who issued a Medical Assessment Certificate (MAC) on 11 January 2022.
The appellant relies on the following grounds of appeal under section 327(3) of the Workplace Injury Management and Workers Compensation Act 1998 (1998 Act):
· the assessment was made on the basis of incorrect criteria,
· the MAC contains a demonstrable error.
The delegate is satisfied that, on the face of the application, at least one ground of appeal has been made out. The Appeal Panel has conducted a review of the original medical assessment but limited to the grounds of appeal on which the appeal is made.
The Personal Injury Commission Rules 2021 (the PIC Rules), and Procedural Direction PIC7 – Appeals, reviews, reconsiderations and correction of obvious errors in medical disputes, set out the practice and procedure in relation to the medical appeal process under section 328 of the 1998 Act. An Appeal Panel determines its own procedures in accordance with the PIC Rules.
The assessment of permanent impairment is conducted in accordance with the NSW Workers Compensation Guidelines for the Evaluation of Permanent Impairment, 4th ed, reissued 1 March 2021 (the Guidelines) and the American Medical Association Guides to the Evaluation of Permanent Impairment, 5th ed (AMA 5).

RELEVANT FACTUAL BACKGROUND

Mr Payne commenced employment with the respondent, Shellharbour City Council, in 2005. He suffered an injury to his left knee on 30 September 2015 (the subject injury). Mr Payne continued to suffer symptoms in the left knee which were only partially relieved by conservative measures recommended by the orthopaedic surgeon, Dr Stackpool.
Mr Payne continued to have trouble performing his work tasks due to symptoms in the left knee and in 2017 he came under the care of another orthopaedic surgeon, Dr Bhimani, who carried out a total left knee replacement on 26 September 2017.
Mr Payne had earlier sustained an injury to his left knee in a motorcycle accident in 1986 and had also suffered an injury to the knee at work in 2009. These injuries did not prevent him from carrying out his work tasks, initially as a leading hand, mainly performing concreting work, and by the time of the subject injury in 2015, as a “building attendant commissionaire”.
On 21 October 2020 Mr Payne was examined by an orthopaedic surgeon, Dr Brian Stephenson, for the purpose of assessment of impairment resulting from the subject injury. Dr Stephenson assessed Mr Payne as having 20% whole person impairment (WPI) as a result of the subject injury. Based on the history and records available to him, Dr Stephenson did not consider that the previous injuries, nor any pre-existing condition, contributed to the impairment assessed and accordingly made no deduction pursuant to section 323 of the 1998 Act.
Mr Payne’s solicitors made a claim for lump-sum compensation pursuant to section 66 of the Workers Compensation Act 1987 (1987 Act). The insurer arranged for Mr Payne to be re-examined by an orthopaedic surgeon, Dr Stephen Rimmer to assess impairment arising from the injury. Dr Rimmer had previously examined Mr Payne in 2016. Dr Rimmer assessed Mr Payne as having achieved a good result from his knee replacement and accordingly assessed him as suffering 15% WPI. Dr Rimmer attributed the whole of this impairment to the motorcycle accident in 1986.
Mr Payne’s solicitors filed an Application to Resolve a Dispute in the Personal Injury Commission. The dispute as to the extent of impairment, if any, arising from the subject injury was referred to the Medical Assessor who examined Mr Payne on 20 December 2021. In his MAC dated 11 January 2022 the Medical Assessor assessed Mr Payne as suffering 20% WPI. The Medical Assessor deducted one half of that impairment as due to the pre-existing condition in the left knee to give an assessment of 10% WPI as a result of the subject injury.

PRELIMINARY REVIEW

The Appeal Panel conducted a preliminary review of the original medical assessment in the absence of the parties.
As a result of that preliminary review, the Appeal Panel determined that it was not necessary for the worker to undergo a further medical examination as sufficient information was available to the Panel to determine the appeal. The Panel noted that the appellant had sought re-examination but the Panel was of the view that re-examination was unlikely to assist in assessing the extent to which a pre-existing condition or previous injury as at 30 September 2015 contributed to the overall degree of impairment assessed by the Medical Assessor, there being no dispute as to the overall level of impairment assessed.

EVIDENCE

Documentary evidence

The Appeal Panel has before it all the documents that were sent to the Medical Assessor for the original medical assessment and has taken them into account in making this determination. At the time of the examination by the Medical Assessor Mr Payne produced an MRI of the left knee which had been carried out on 1 September 2021. That scan was reported by the Medical Assessor as “only showing effusion there is significant metal artefact from the total knee replacement so it is not a conclusive study.”
That scan was not available to the Panel but neither party referred to it in submissions and it does not appear to have played any part in the findings made by the Medical Assessor.

Medical Assessment Certificate

The parts of the medical certificate given by the Medical Assessor that are relevant to the appeal are set out, where relevant, in the body of this decision.

SUBMISSIONS

Both parties made written submissions. They are not repeated in full but have been considered by the Appeal Panel.
In summary, the appellant submits that the Medical Assessor had relied upon an incorrect history in two respects in concluding that Mr Payne suffered a pre-existing condition in the left knee which warranted a deduction of one half of the extent of impairment assessed upon examination.
In reply, the respondent submits that it was open to the Medical Assessor to discount the impairment by one half as that finding was open on the evidence and any error with respect to the opinions of Dr Haber and Dr Stackpool did not materially affect the conclusion that such a deduction was appropriate.

FINDINGS AND REASONS

The procedures on appeal are contained in section 328 of the 1998 Act. The appeal is to be by way of review of the original medical assessment but the review is limited to the grounds of appeal on which the appeal is made.
In Campbelltown City Council v Vegan[1] the Court of Appeal held that the Appeal Panel is obliged to give reasons. Where there are disputes of fact it may be necessary to refer to evidence or other material on which findings are based, but the extent to which this is necessary will vary from case to case. Where more than one conclusion is open, it will be necessary to explain why one conclusion is preferred. On the other hand, the reasons need not be extensive or provide a detailed explanation of the criteria applied by the medical professionals in reaching a professional judgement.
[1] [2006] NSWCA 284.
The appeal is limited to the issue of whether the Medical Assessor fell into error in considering the extent to which any proportion of the impairment assessed by the Medical Assessor is due to any previous injury, pre-existing condition or abnormality. There is no dispute that Mr Payne was appropriately assessed as suffering 20% WPI upon examination by the Medical Assessor.
The Medical Assessor recorded the history of injury to the left knee on 30 September 2015. He noted that Mr Payne had suffered a motor vehicle accident in 1986 with a fracture of the left ankle. Mr Payne had undergone left knee arthroscopy in the early 1990s performed by Dr Haber. Mr Payne suffered an injury to the left knee at work in 2009 and Mr Payne had again been referred to Dr Haber who advised conservative treatment. The Medical Assessor commented; “He was advised by Dr Haber to treat that conservatively as he was too young. The only surgical recommendation was a knee replacement in the future.”
The Medical Assessor recorded that Mr Payne had also consulted Dr Stackpool. The Medical Assessor recorded; “he went back to see Dr Stackpool again in 2016 after the work injury in September 2015. Dr Stackpool still recommended him to have conservative treatment.”
The Medical Assessor noted that Mr Payne had subsequently been referred to Dr Bhimani with complaints relating to the left hip and the left knee. He recorded that Dr Bhimani had performed a left hip replacement in May 2017 and had then performed a left knee replacement on 26 September 2017 “for the valgus arthritic problem”. The Medical Assessor recorded that Mr Payne had initially been happy with the result of the knee replacement, but he began to notice problems with swelling and pain subsequently. He recorded that Mr Payne had returned to work performing suitable duties and avoiding “heavy overstress of the left knee”.
Under the heading “Details of any previous or subsequent accidents, injuries or condition” the Medical Assessor recorded:
“In 1986 he suffered a motor vehicle accident and there was a fracture of the left ankle. In early 1990 he had arthroscopy on this knee with meniscal removal. In 2009 after a work injury, he was already noticed to have arthritis of the lateral compartment requiring total knee replacement but was recommended to delay as the patient was young. In 2015 with this injury the knee getting worse [sic]”.
The Medical Assessor noted reports of radiological investigations. An MRI scan of the left knee carried out on 23 September 2009 was reported as showing “lateral compartment degenerative changes with valgus alignment”. MRI scan of that knee on 15 October 2009 noted “lateral meniscal tear with lateral compartmental degenerative changes” and MRI scan of the left knee on 31 October 2015 was reported as showing “advanced lateral compartment degenerative changes.”
The Medical Assessor summarised injuries and diagnoses:
“Mr Philip Payne had pre-existing left knee problem requiring a knee arthroscopy in early 1990. Investigation in 2009 already confirmed reasonable OA changes and the treating surgeon advised to delay the knee replacement. There was further work injury in 2015 and end up with a total knee replacement with a reasonable outcome”.
Explaining his calculation of impairment, the Medical Assessor reported that he had assessed Mr Payne in accordance with Table 17-35[2] and Table 17-33 of AMA 5 to arrive at an assessment of 20% WPI based upon an outcome from the knee replacement rated as “fair”. The Medical Assessor reported:
“The main problem in this case is how much was it contribution (sic) from pre-existing condition. In the radiological investigations when he had the work injury in 2009 there was obvious evidence of lateral compartment OA. The treating surgeon at that time Dr Haber and Dr Stackpool, both recommended him to consider knee replacement but at a later stage because he was too young. This is the strong evidence for contribution from pre-existing condition as he only started to work with Shellharbour City Council from 2005. It would be related to the motor vehicle accident or any other injury which he end up with (sic) arthroscopy in early 1990s by Dr Haber.”
and
“I believe there is a 20% whole person impairment for the knee function and I would say a deduction of ½ is appropriate because there is obvious pre-existing degenerative changes even in the radiological investigation back in 2009 and that will leave behind 10% whole person impairment.”
[2] Table 17-35 of AMA 5 is replaced by the Table appearing at page 21 of the Guidelines but nothing in the appeal turns upon the difference.
Explaining his reasons for attributing one half of the assessed level of impairment to a pre-existing condition or previous injury, the Medical Assessor said: “There is obvious degenerative changes even dated back to the radiological investigations in 2009.”
The appellant submitted that the Medical Assessor had given weight to what he believed to have been the opinion of Dr Haber and Dr Stackpool, expressed prior to the subject injury, that left knee replacement was the appropriate surgical procedure, but that Mr Payne was too young at that time. The appellant submitted that there was no evidence that Dr Haber had expressed that view prior to the subject injury and the Medical Assessor had wrongly accepted that Dr Stackpool had expressed a similar view, prior to the subject injury, when the fact was that Dr Stackpool did not see Mr Payne until after the subject injury.
The appellant submitted that the Medical Assessor had given substantial weight to what he understood to be the view of Dr Haber and Dr Stackpool, expressed prior to the subject injury, pointing to the words:
“The treating surgeon at that time Dr Haber and Dr Stackpool, both recommended him to consider knee replacement but at a later stage because he was too young. This is the strong evidence for contribution from pre-existing condition as he only started to work with Shellharbour City Council from 2005.”
The respondent submitted that any error in this regard was incidental to the assessment of contribution. The respondent pointed to the radiological evidence and submitted that, in effect, the Medical Assessor had correctly stated that there were obvious degenerative changes dating back to 2009 and this was the reason for deduction stated by the Medical Assessor at paragraph 11 of the MAC.
The Panel has considered the whole of the material before the Medical Assessor which included the report from Dr Haber dated 12 November 2009 (with the exception of the MRI scan of 1 September 2021, the summary of which has been noted by the Panel). Dr Haber reported to the insurer that he had examined Mr Payne at the request of the treating general practitioner, Dr Shah, after Mr Payne had twisted his left knee in the workplace, giving rise to symptoms. Dr Haber recorded “While walking upstairs he feels some pain and clicking and when the knee is extended. He sometimes feels the knee ‘locks’. It has somewhat settled.”[3]
[3] Report dated 12 November 2009, at page 60 of the Application to Resolve a Dispute.
Dr Haber noted that Mr Payne had undergone an arthroscopy following his motor bike accident some 20 years earlier and that MRI scan was reported as showing “tear of the posterior horn of the lateral meniscus”. Dr Haber reported: “The examination demonstrated he walked with a normal gait. There was mild wasting but no obvious effusion or deformity. Tenderness was well localised to the lateral joint line. His range of motion was mildly restricted at 5° to 130°. There was no evidence of instability.”
Dr Haber recommended management: “We discussed the nature of this condition and the treatment options available. I have suggested a wait and see approach before we proceed with further investigations or intervention as his symptoms have settled and he can keep surfing.”
The Panel is satisfied that, in the context of a report from an orthopaedic surgeon to a general practitioner, Dr Haber’s reference to “treatment options” would have included potential knee replacement, given the findings disclosed by the MRI scan. The Medical Assessor was entitled to draw the inference that the reference to “treatment options” and a wait-and-see approach before intervention indicated the probability of a future knee replacement.
The reference to the opinion of Dr Stackpool is, however, incorrect, as Mr Payne was not referred to Dr Stackpool until after the subject injury. In assuming that Dr Stackpool had expressed the view that replacement was appropriate prior to the subject injury, the Medical Assessor fell into error. The respondent concedes that this was the case, but submits that, in the final analysis, the Medical Assessor’s assessment was correct in the light of the radiological reports from 2009 and 2015. This was the reason given by the Medical Assessor in paragraph 11 of the MAC for the deduction of one half.
The Panel would be inclined to accept the respondent’s argument, were it not for the significant weight which the Medical Assessor stated he placed upon that assumption. The words used by the Medical Assessor suggests that he placed weight upon a conclusion that was at least partially incorrect with respect to the view of Dr Stackpool when weighing the whole of the evidence. Error on the face of the MAC has been made out in this regard and that error appears to form part of the chain of reasoning which led the Medical Assessor to his conclusion that a deduction of one half was appropriate.
Error having been established, it is appropriate that the Panel reviews the evidence to determine the extent of any deduction to be made pursuant to section 323 of the 1998 Act which provides:
“323 DEDUCTION FOR PREVIOUS INJURY OR PRE-EXISTING CONDITION OR ABNORMALITY
(1)     In assessing the degree of permanent impairment resulting from an injury, there is to be a deduction for any proportion of the impairment that is due to any previous injury (whether or not it is an injury for which compensation has been paid or is payable under Division 4 of Part 3 of the 1987 Act) or that is due to any pre-existing condition or abnormality.
(2)     If the extent of a deduction under this section (or a part of it) will be difficult or costly to determine (because, for example, of the absence of medical evidence), it is to be assumed (for the purpose of avoiding disputation) that the deduction (or the relevant part of it) is 10% of the impairment, unless this assumption is at odds with the available evidence.
Note : So if the degree of permanent impairment is assessed as 30% and subsection (2) operates to require a 10% reduction in that impairment to be assumed, the degree of permanent impairment is reduced from 30% to 27% (a reduction of 10%).
(3)     The reference in subsection (2) to medical evidence is a reference to medical evidence accepted or preferred by the medical assessor in connection with the medical assessment of the matter.
(4)     The Workers Compensation Guidelines may make provision for or with respect to the determination of the deduction required by this section.
Note : Section 68B of the 1987 Act makes provision for how this section applies for the purpose of calculating workers compensation lump sum benefits for permanent impairment and associated pain and suffering in cases to which section 15, 16, 17 or 22 of the 1987 Act applies.”
The subject injury is agreed to have occurred on 30 September 2015 and that is the date at which it is appropriate to consider the existence of previous injury or pre-existing condition or abnormality. There is no dispute between the parties that Mr Payne had previously suffered injury to his left leg in 1986 and by 1990 had developed a condition in the left knee which required arthroscopy at the hands of Dr Haber. In 2009 Mr Payne had a further injury to the left knee and was again examined by Dr Haber who noted the report of the MRI scan performed on 15 October 2009:
“Findings: there is an extensive radial tear of the posterior horn of the lateral meniscus which is largely absent. This extends into the meniscal body as a radial tear evidenced by truncation and moderate extrusion of the body. The posterior root attachment, anterior root attachment and a portion of the anterior body appear intact. There is associated extensive denudation of the lateral compartment cartilage posteriorly. The medial meniscus, cruciate ligaments, collateral ligaments and extensor mechanisms appear intact. There is a little chondral softening involving the lateral patellar facet cartilage and a minor fissure involving the patellar apex cartilage. The medial compartment cartilage appears intact.
Tricompartmental osteophytes noted. There is a trace knee joint effusion and a tiny Baker’s cyst.
The visualised posterolateral corner stabilisers appear intact. No abnormality of the visualised pes anserine.
Conclusion: There is an extensive radial tear of the posterior horn of the lateral meniscus demonstrating some extension into the body associated with locally advanced lateral compartment osteoarthrosis and a background of tricompartmental involvement.”

Following Dr Haber’s examination, Mr Payne continued to work with a restriction limiting movement of the left knee until 24 November 2009 when he was certified fit for pre-injury duties[4]. At some point in time, he ceased to perform the duties of a leading hand in the maintenance area which involved bricklaying and concreting and which he describes in his statement as a later role. He resumed surfing, playing golf and riding motorbikes. He said that he felt that “the injury had resolved”[5].
[4] Final WorkCover NSW medical certificate, Dr Shah, dated 24 November 2009.
[5] Statement, paragraph 5 (undated) attached to Application to Resolve a Dispute at Page 3.
Prior to the subject injury the patient records of the Centre Health Complex which were in evidence record no complaints of difficulties with the left knee after 2 December 2009 when the general practitioner recorded “seen Dr Haber, conservative mx, played squash last night – mild ache in the left knee. Hamstring strain better. Been back at work and normal duties for one week.” An entry on 7 November 2011 in connection with a general health issue records that Mr Payne had been doing “a lot of surfing”.
The Panel accepts that Mr Payne, prior to the subject injury, was able to perform his pre-injury work and lead a reasonably active life notwithstanding the condition in the left knee.
The report of the MRI scan carried out following the subject injury on 31 October 2015 records:
“Findings: The posterolateral bundle of the ACL demonstrates evidence of mild myxoid change-scar, without discernible fibre discontinuity or ganglion formation. Intact PCL, MCL, LCL and biceps femoris insertion. Mild insertional popliteus tendinosis.
Advanced lateral femorotibial compartment osteoarthritis, with extensive bone on bone articulation, eburnation of subchondral bone, subchondral sclerosis and mild subchondral bone marrow oedema. Moderate lateral joint line and notch osteophytes. Attenuated, chronically torn posterior horn and body lateral meniscus, with mildly irregular margins but no extensive unstable flap component.
Mild myxoid degeneration posterior horn medial meniscus, without surface tear or parameniscal cyst. Chondral softening posterior weight-bearing aspect medial femoral condyle, without surface defect. Intact articular cartilage medial tibial plateau. Moderate medial notch osteophyte.
Chondral softening patellar apex, without surface defect. Intact articular cartilage femoral trochlea. Small to moderate effusion. Mild degenerative synovitis. Small popliteal cyst. Multilocular posterior capsular ganglion at the posterolateral margin of the tibial footprint of the PCL (3 x 2 x 1 cm), intact quadriceps tendon insertion and patellar tendon. Mild oedema free edge deep infrapatellar fat pad anterior margin lateral femorotibial compartment. Mild thickening semimembranosus bursa.
Conclusion: MRI LEFT KNEE demonstrating:
Advanced chronically torn, attenuated posterior horn and body lateral meniscus, with mild irregularity at the free edge but no extensive unstable flap component.
Chondral softening posterior weight-bearing aspect medial femoral condyle, without surface defect.
Myxoid degeneration medial meniscus, without surface tear. Small to moderate effusion and mild degenerative synovitis.
Posterior capsular ganglion (3 x 2 x 1 cm) adjacent to the tibial footprint of the PCL.”
The evidence establishes that, despite the advanced osteoarthritis in the left knee, Mr Payne was able to lead an active life and there is no evidence of any complaint of symptoms between December 2009 and the subject injury with respect to the left knee. In accordance with the Guidelines, Mr Payne is assessed by rating the outcome of his knee replacement. That knee replacement was made necessary by the subject injury and Mr Payne may well have been able to continue his level of activity without the need for knee replacement in the absence of the subject injury.
There is no dispute that, at the date of injury, Mr Payne suffered from a pre-existing osteoarthritic condition in the left knee. That condition did not give rise to impairment until the subject injury, but it did contribute to the requirement for knee replacement. Although it is difficult to say precisely to what extent the osteoarthritis contributed to the final assessment of impairment, a deduction of one tenth would be at odds with the available evidence.
The need for surgery, which in turn gives rise to the assessment of impairment, results from the pre-existing osteoarthritic condition and the subject injury. Given that the knee appeared to function satisfactorily up to the subject injury, the Panel is of the view that the level of contribution is somewhat less than half, but clearly more than one tenth. It is reasonable to assess the contribution at 40% or two fifths.
Accordingly, Mr Payne is assessed because of pathology in the left knee in accordance with Table 17-35 (as modified by the Guidelines) and Table 17-33 of AMA 5. A deduction of two fifths is appropriate pursuant to section 323 of the 1998 Act in respect of the pre-existing osteoarthritic condition in the knee to give 12% WPI as a result of the subject injury.
For these reasons, the Appeal Panel has determined that the MAC issued on 11 January 2022 should be revoked, and a new MAC should be issued. The new certificate is attached to this statement of reasons.

PERSONAL INJURY COMMISSION

APPEAL PANEL

MEDICAL ASSESSMENT CERTIFICATE

Injuries received after 1 January 2002

This Certificate is issued pursuant to s 328(5) of the Workplace Injury Management and Workers Compensation Act1998.

The Appeal Panel revokes the Medical Assessment Certificate of Dr You-Key Ho and issues this new Medical Assessment Certificate as to the matters set out in the Table below:

Table - Whole Person Impairment (WPI)

Body Part or system

Date of Injury

Chapter, page and paragraph number in NSW workers compensation guidelines

Chapter, page, paragraph, figure and table numbers in AMA 5 Guides

% WPI

Proportion of permanent impairment due to pre-existing injury, abnormality or condition

Sub-total/s % WPI (after any deductions in column 6)

Left lower extremity (knee)

30/09/15

Chapter 3, pages 13-21

Chapter 15, Table 17-33 and Table 17-35 (as amended)

20%

2/5

12%

Total % WPI (the Combined Table values of all sub-totals)

12%

William Dalley
Member
James Bodel

Medical Assessor

Mark Burns

Medical Assessor

[2022] NSWPICMP 99

2 May 2022