Qantas v Malios

[2012] VSC 218

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

JUDICIAL REVIEW AND APPEALS LIST

No. SCI 2011 03245

QANTAS AIRWAYS LIMITED	Plaintiff
v
DR JOHN MALIOS DR DAVID FISH DR CHRIS GRANT MR JOHN BOURKE MS SANDRA ALFONSO	Defendants

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JUDGE:	BEACH J
WHERE HELD:	Melbourne
DATE OF HEARING:	24 May 2012
DATE OF JUDGMENT:	24 May 2012
CASE MAY BE CITED AS:	Qantas v Malios & Ors
MEDIUM NEUTRAL CITATION:	[2012] VSC 218

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ADMINISTRATIVE LAW – Review of medical panel – Alleged jurisdictional error – Alleged denial of procedural fairness – Scope and extent of “accepted injuries” – Assessment of whole person impairment – Impairment resulting from injury – Impairment resulting from accepted injury – Accident Compensation Act 1985, ss 91, 98C and 104B.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr M.F. Fleming SC with Mr M.J. Richards	Sparke Helmore
For the First to Fourth Defendants	No appearance	Monahan + Rowell
For the Fifth Defendant	Mr N.D. Horner	Slater & Gordon

HIS HONOUR:

Introduction

1. Ms Sandra Alfonso, the fifth defendant, is an employee of Qantas Airways Limited, the plaintiff. This proceeding relates to a claim by Ms Alfonso that on 17 March 2008, in the course of her employment with Qantas, she fell and suffered injury. On 14 May 2010, Ms Alfonso completed a claim form seeking impairment benefits pursuant to s 98C of the Accident Compensation Act 1985. In her claim form, Ms Alfonso alleged her injuries were “left shoulder, neck, back, anxiety and depression”.

1. On 14 February 2011, liability was accepted by Qantas for the following injuries – left shoulder, neck and anxiety and depression (“the accepted injuries”).  Liability was rejected for the back injury.[1]  In its letter of 14 February 2011, Qantas advised Ms Alfonso that Qantas had determined her combined whole person physical impairment at 4%, and her whole person psychiatric impairment at 0%.  On 11 March 2011, Ms Alfonso completed a worker’s response form in which she accepted the liability determination made by Qantas with respect to the accepted injuries, and disputed Qantas’ determination of her combined whole person physical impairment of 4% and her whole person psychiatric impairment of 0%.

   [1]Cf s 104B(2) of the Accident Compensation Act.

1. On 29 March 2011, Qantas referred medical questions[2] pursuant to s 104B(9) of the Accident Compensation Act to a medical panel for its opinion under s 67 of the Accident Compensation Act.  Dr John Malios, the first defendant, is the Deputy Convenor of Medical Panels.  Following the referral of the medical questions, on 18 May 2011, a medical panel comprising the second, third and fourth defendants (Dr Chris Grant, Dr David Fish and Mr John Bourke) answered the medical questions as follows:

   [2]Cf paragraph (d) of the definition of “medical question” in s 5(1) of the Accident Compensation Act.

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

Answer:In the Panel’s opinion the worker has an 11% whole person impairment resulting from the accepted left shoulder, neck injury when assessed in accordance with Section 91 of the Act. The degree of impairment is permanent.

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

For the purposes of Sections 134AB(3) and (15) of the Act there is a combined whole person impairment of 11% resulting from the accepted physical and psychiatric injuries. The degree of impairment is permanent within the meaning of the Act.

The degree of impairment includes a 10% whole person impairment assessed in accordance with Chapter Three of the American Medical Association Guides to the Evaluation of Permanent Impairment (Fourth Edition).

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

Answer:No.”

1. In this proceeding, by amended originating motion, Qantas contends that, contrary to law, the Medical Panel made an assessment of impairment relating to an injury which was not one of the accepted injuries, and therefore was not the subject of the referral or the claim for impairment benefits pursuant to s 98C of the Accident Compensation Act.  The injury which Qantas contends was not one of the accepted injuries was scarring.  In the circumstances, Qantas contends that the Panel has committed a jurisdictional error and/or denied Qantas procedural fairness.  By its amended originating motion, Qantas sought certiorari quashing the Medical Panel’s decision “insofar as it relates to scarring only”, and remission to the same Medical Panel for an assessment to be provided for the accepted injuries only.[3]

   [3]However, in its submissions, Qantas sought the quashing of all of the Medical Panel’s decision and remission to a differently constituted medical panel.

1. Ms Alfonso opposes the relief sought by Qantas, contending that there has been no jurisdictional error or want of procedural fairness.  At trial, the Deputy Convenor of Medical Panels (the first defendant) and the Medical Panel (the second, third and fourth defendants) took no part in the proceeding, contending that they would submit to such orders as the Court might make in the proceeding.[4]

   [4]See R v The Australian Broadcasting Tribunal & Ors;  ex parte Hardiman & Ors (1980) 144 CLR 13, 35.

The Medical Panel’s reasons

1. On page 1 of the Medical Panel’s reasons, the Panel “noted from the referral that it is accepted that the worker [Ms Alfonso] suffered a left shoulder and neck injury and an anxiety and depression injury during the course of her employment with a designated date of injury of 17 March 2008”.  The Panel’s reasons then record the history taken from Ms Alfonso, including the performance of surgery on her left shoulder on 13 October 2009.

1. In the reasons, the Panel records that it performed a physical examination of Ms Alfonso.  It records the results of this examination and that it examined available medical imaging and reports.  The Panel then expressed the following opinion:

“The Panel concluded that the worker is suffering from a persistent soft tissue injury of the neck and subacromial bursitis surgically treated with residual stiffness of the left shoulder, relevant to the accepted neck and left shoulder injuries”.

1. The Panel goes on to record that it performed a psychiatric assessment.  Some more of the plaintiff’s history is then set out, before the Panel expresses its conclusion that Ms Alfonso “is not currently suffering from any psychiatric or abnormal psychological condition”.

1. The Panel then described the conduct of its impairment assessment of Ms Alfonso, and expressed the balance of its reasons, in the following terms:

“The Panel conducted an impairment assessment in accordance with the American Medical Association Guides to the Evaluation of Permanent Impairment (Fourth Edition, Third Reprint) as required by Section 91 of the Act. The Panel considered that no further information was required from the worker’s treating practitioners to carry out the assessment.

The Panel carried out an assessment of the accepted neck injury in accordance with the Specific Procedures and Directions in Section 3.3f of Page 101 of the Guides.

The Panel assessed the worker in accordance with Table 70 of Chapter Three and concluded that there is evidence of neck injury but without clinical evidence of radiculopathy or loss of motion segment integrity.  The Panel therefore concluded that the appropriate category for the cervical spine is DRE II pursuant to Table 73 of Chapter Three, resulting in a 5% whole person impairment.

As the impairment attributable to the neck injury could be assessed in accordance with diagnosis-related estimates model, the use of the range of motion model is not appropriate.

The Panel assessed impairment of the worker’s left shoulder in accordance with Section 3.1 of Chapter Three.  Joint ranges of movement were measured using a goniometer in accordance with the instructions in the Guides.

The Panel assessed the worker as follows:

Left Shoulder Movement	Figure	Assessed Range of Motion	Upper Extremity Impairment
Flexion	38	140°	3%
Extension	38	50°	0%
Abduction	41	115°	3%
Adduction	41	40°	0%
Internal rotation	44	60°	2%
External rotation	44	70°	0%

The Panel assessed an 8% left upper extremity impairment due to abnormal motion of the left shoulder pursuant to Figures 38, 41 and 44 of section 3.1j.  This is equivalent to a 5% whole person impairment pursuant to Table 3 of Chapter Three.

The Panel assessed the worker’s surgical scarring pursuant to Sections 13.4 and 13.5 of Chapter Thirteen.  The Panel noted the appearance of the scar and the hypertrophy of the scar, and the Panel assessed a low Class 1 impairment, resulting in a 1% whole person impairment pursuant to Table 2 of Chapter Thirteen.

The Panel did not conduct a psychiatric impairment assessment in accordance with The Guide for the Evaluation of Psychiatric Impairment for Clinicians (GEPIC) as the Panel had concluded that the worker is not suffering from any psychiatric or abnormal psychological condition, relevant to the accepted anxiety and depression injury, and therefore there is no psychiatric impairment in accordance with Section 91 of the Act.

Using the formula A + B (1-A) as prescribed on page 322 of the Guides, the Panel combined the impairments to an impairment of 10.65% which in accordance with Section 91(1) of the Accident Compensation Act, 1985, results in the nearest whole percent of 11%.  The degree of impairment is permanent.

The Panel therefore concluded that the worker has an 11% whole person impairment resulting from the accepted left shoulder and neck injury when assessed in accordance with section 91 for the purposes of Sections 98C and 134AB(3) and (15) of the Act. The degree of impairment is permanent.

The degree of impairment includes a 10% whole person impairment assessed in accordance with Chapter Three of the American Medical Association Guides to the Evaluation of Permanent Impairment (Fourth Edition).

The Panel considered the reports of Mr Michael Troy, Independent Medical Examiner, dated 17 July 2010 and 21 January 2011, in the referral material.  The Panel noted that Mr Troy, assessed at 4% whole person impairment arising from the accepted left shoulder injury and a 0% whole person impairment relevant to the accepted neck injury.  The Panel’s higher assessment of a 5% whole impairment resulting from the accepted neck injury and 5% whole person impairment arising from the accepted left shoulder injury, and a 1% whole person impairment in respect of surgical scarring, were formed on the basis of the Panel’s clinical experience and its examination of the worker on 19 April 2011, and the Panel considers that the assessments accurately reflect the degree of the worker’s impairment resulting from the accepted physical injuries, and in accordance with the instructions in the Guides.

The Panel assessed the accepted left shoulder and neck injury in accordance with 98E of the Act.  The Panel acknowledged that the worker has some loss of use of the left shoulder and neck but the Panel considers that the loss of use is not severe enough to be regarded as effectively a total loss or total loss of use of the left arm or greater part of the left arm or a total impairment of the cervical spine.  The Panel therefore concluded that there is no total loss injury or total loss of use injury when assessed pursuant to section 98E of the Act.”

1. As can be seen from the above reasons, the Panel assessed Ms Alfonso’s neck injury at 5%, her left shoulder in accordance with Chapter Three of the Guides at 5%, and the left shoulder surgical scar at 1%. Using the combined values formula, 5% combined with 5% combined with 1% produces a total whole person impairment of 10.6525%. Rounding this to the nearest whole per cent as required by s 91(10) of the Accident Compensation Act, produces a whole person impairment of 11%. Qantas’ case is that the left shoulder surgical scar should not have been assessed. If Qantas’ case is accepted, then Ms Alfonso’s whole person impairment would (if the balance of the Panel’s reasons are accepted) be 5% combined with 5% (9.75%), rounded in accordance with s 91(10) to 10%.

Analysis

1. Qantas’ case is dependent upon the proposition that the left shoulder surgical scar is not part of the accepted left shoulder injury.  The proposition that the left shoulder surgical scar is not part of the left shoulder accepted injury must be rejected.  There is no basis for limiting the assessment of the accepted left shoulder injury to some left shoulder injury unaffected by necessary or relevant surgery;  and then to somehow contend that the scarring caused by treating surgery is a separate injury, not to be assessed as part of an “accepted left shoulder injury”.

1. If authority is necessary to support this conclusion, then it can be found in the line of cases commencing with the High Court’s decision in Mahony v J Kruschich (Demolitions) Pty Ltd.[5]  More specifically, as was said by Pagone J in Western Health v Dr Gallichio & Ors:[6]

“A medical panel charged with the task of making an assessment under the Wrongs Act is required to consider both the injury and its sequelae or consequences:  Archibold Russell Limited v Corser;[7] Kidman v Sefa;[8] Farrar v Western Metropolitan College of Tafe[9] and Dunin v Harrison.[10]  The medical panel’s consideration of the “post surgical scarring” is, in my view, to be seen as a consideration by it of the consequences of the incident which was said to have given rise to the neurocardiogenic syncope as the impairment.  The referral letter may have been carelessly inaccurate in its description of the injury but, I think, a fair reading of the referral letter on its own or in the context of all of the materials available to the medical panel makes clear that the “neurocardiogenic syncope” was relevantly the impairment said to have resulted from the injury occasioned by the insertion of the permanent pacemaker on 23 May 2006.  Seen in that light the medical panel’s consideration of the “post surgical scarring” is sequelae or the consequence of the injury.”[11]

[5](1985) 156 CLR 522.

[6][2009] VSC 134, [13]. Although this decision was one of a number of decisions overruled by the Court of Appeal in Sherlock v Lloyd & Ors [2010] 27 VR 434 on the issue of whether inadequate reasons was itself an error of law, Western Health v Gallichio was not overruled or doubted in relation to the current issue concerning the proper treatment of surgical scarring.

[7][1921] 1 AC 351.

[8][1996] 1 VR 86.

[9][1999] 1 VR 224.

[10](2002) 8 VR 596.

[11]Footnotes in original.

1. While Western Health v Gallichio concerned the making of an impairment assessment under the Wrongs Act 1958, Pagone J’s statement extracted above is equally applicable in respect of assessments made under the Accident Compensation Act.[12]  Further, as in Western Health v Gallichio, a fair reading of the referral document on its own or in the context of all of the materials available to the Medical Panel required the Medical Panel to assess the surgical scarring as part of the impairment resulting from the accepted left shoulder injury.[13]  It follows that Qantas’ complaint that the Panel committed jurisdictional error or acted ultra vires must be rejected.

   [12]See further, s 104B(5B) of the Accident Compensation Act.

   [13]Cf the facts and result in Clarchet Pty Ltd v Demediuk & Ors [2011] VSC 22. See further, Silvertop Taxi Service Limited v Fish & Ors [2006] VSC 448.

1. Further, Qantas’ claim that it was denied procedural fairness must also be rejected. A copy of Ms Alfonso’s s 98C claim was sent to Qantas under cover of a letter from her solicitors dated 18 May 2010. That letter relevantly provided:

“To ensure a proper assessment under Section 91 of the Act and in accordance with the American Medical Association Guides to the Evaluation of Permanent Impairment (4^th Edition) I enclose copies of the following medical reports from my client’s medical treatment providers:

·Ms Diane Abbott dated 25 March 2010 and 10 June 2009

·Dr Hussain Hilmy dated 19 April 2010

·Dr Andrew Cheasley dated 23 March 2010, 26 April 2009 and 14 September 2008

·Mr Martin D Richardson dated 8 March 2010

I suggest that my client’s degree of permanent impairment be assessed according to the following Chapters of the AMA Guides:

·Clinical Guidelines for rating Psychiatric Impairment

·Chapter 3:  The Musculoskeletal System

This is not intended to be an exhaustive list and if there are other chapters an independent impairment assessor considers appropriate they should conduct an assessment accordingly.”  (Emphasis mine)

1. The reports served by Ms Alfonso’s solicitors disclosed the fact that Ms Alfonso had had surgery performed on her left shoulder on 13 October 2009 to treat her left shoulder injury.[14]  However, the reports provided on behalf of Ms Alfonso did not purport to assess her whole person impairment, either in respect of what were to become the accepted injuries or at all.  That was a matter for Qantas[15] – Ms Alfonso’s solicitors having suggested a relevant chapter of the AMA Guides, before noting that their suggestion was not exhaustive and that if there were other appropriate chapters of the Guides, then these should be utilised.

   [14]See for example the report of Dr Cheasley dated 23 March 2010.

   [15]After arranging relevant assessments in accordance with the provisions of s 104B of the Accident Compensation Act.

1. The solicitors for Qantas arranged to have Ms Alfonso examined by Mr Michael Troy (general surgeon) and Dr Alan Jager (psychiatrist).  Dr Jager’s examination resulted in a 0% psychiatric impairment assessment being made.

1. Mr Troy examined Ms Alfonso on two occasions (13 July 2010 and 18 January 2011).  Mr Troy took a history from the plaintiff on both occasions that she had had shoulder surgery in October 2009 as a result of her shoulder injury.  Following Mr Troy’s first examination, Mr Troy provided a report that noted and described the plaintiff’s left shoulder surgical scar.  Ultimately, Mr Troy assessed Ms Alfonso’s whole person impairment in respect of her neck at 0% and her whole person impairment in respect of her left shoulder at 4%.  While Mr Troy noted and described Ms Alfonso’s left shoulder scar, he did not record any assessment in respect of it.

1. At all relevant times Qantas knew that the plaintiff had had surgery on her left shoulder, and in respect of that accepted injury. Indeed, in their letters to Mr Troy arranging each examination of Ms Alfonso, the solicitors for Qantas made reference to this surgery. Further, Mr Troy’s first report disclosed the existence of the resulting scar. It follows that Qantas was on notice at all relevant times that part of the accepted left shoulder injury included the left shoulder scar;  alternatively, Qantas was on notice that the left shoulder scar was an impairment resulting from the accepted left shoulder injury.  In these circumstances there was no denial of procedural fairness in this case in the Medical Panel performing the assessment it was bound to perform.

Conclusion

1. The proceeding must be dismissed.