Saad Bros Motor Pty Ltd v Simon - [2014] NSWWCCPD 22

WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:	Saad Bros Motor Pty Ltd v Simon [2014] NSWWCCPD 22
APPELLANT:	Saad Bros Motor Pty Ltd
RESPONDENT:	Peter Simon
INSURER:	Allianz Australia Workers Compensation (NSW) Ltd
FILE NUMBER:	A1-11490/12
ARBITRATOR:	Mr G Egan
DATE OF ARBITRATOR’S DECISION:	7 January 2014
DATE OF APPEAL DECISION:	23 April 2014
SUBJECT MATTER OF DECISION:	Disease injury; claim for lump sum compensation; whether correct deemed date of injury is the date of incapacity or date of claim; principles in Stone v Stannard Brothers Launch Services Pty Ltd [2004] NSWCA 277; 1 DDCR 701 applied; s 15 and cl 3 of Pt 18C of Sch 6 to the Workers Compensation Act 1987; non-compensable impairment
PRESIDENTIAL MEMBER:	Deputy President Bill Roche
HEARING:	On the papers
REPRESENTATION:	Appellant:	Sparke Helmore Lawyers
Respondent:	Turner Freeman
ORDERS MADE ON APPEAL:	1. Save for amending paragraph 2(b) to delete “Left hip” and to insert “Left lower extremity”, the Arbitrator’s determination of 7 January 2014 is confirmed. 2. The appellant employer is to pay the respondent worker’s costs of the appeal, as agreed or assessed.

INTRODUCTION

Prior to 1 January 2002 (but after 1987), claims for lump sum compensation under s 66 of the Workers Compensation Act 1987 (the 1987 Act) were assessed under a Table entitled “Compensation for permanent injuries”, commonly referred to as the Table of Disabilities or Table of Maims. Under that scheme, workers were compensated for the loss, or partial loss, of a “thing” mentioned in the Table of Disabilities, as assessed by a judge or commissioner of the former Compensation Court of NSW, based on the medical and other evidence tendered, and by reference to the percentages in the Table of Disabilities and the nature of the injury.
For injuries received on or after 1 January 2002, workers were (and still are) compensated for the degree of whole person impairment that has resulted from the injury, as assessed by an Approved Medical Specialist (AMS) applying the WorkCover Guidelines and the American Medical Association’s Guides to the Evaluation of Permanent Impairment, 5^th ed, (AMA5) (see Sch 3 to the Workers Compensation Legislation Amendment Act 2001 and
Sch 2 to the Workers Compensation Legislation Further Amendment Act 2001 (the 2001 amending Acts)).
In the present appeal, the worker suffers from a disease that he contracted in the course of his employment with the appellant between 1973 and 1996, namely, non-Hodgkin’s lymphoma, which caused an incapacity for work in 1997. He claimed and was paid weekly compensation from 1997 until he turned 66 in August 2009, but made no claim for lump sum compensation under s 66 until 30 September 2011.
The issue on appeal is whether, in a claim for lump sum compensation arising out of a disease injury to which s 15 of the 1987 Act applies, the correct date of injury is the date of incapacity (14 July 1997), as the appellant contends, or the date on which the worker claimed lump sum compensation (30 September 2011), as the worker contends and the Arbitrator found.

BACKGROUND

The respondent worker, Peter Simon, worked as a service station attendant with the appellant employer between 1973 until February 1996. In that period, he regularly came into contact with petrol and petrol fumes. In 1997, he saw his general practitioner complaining of breathing problems, night sweats, loss of strength, appetite and energy, and an inability to sleep. In May 1997, he was diagnosed with non-Hodgkin’s lymphoma and commenced treatment with chemotherapy.
On 30 September 1997, Mr Simon claimed weekly compensation and the cost of hospital and medical treatment. The appellant’s insurer accepted liability and made voluntarily payments of compensation, which were backdated to 14 July 1997. It is accepted that, at this time, Mr Simon experienced symptoms of digital neuropathy, bilateral shoulder pain, wrist pain and pain in his hips, knees and ankles.
On 7 August 2009, Mr Simon’s weekly compensation payments ceased, he having turned 66 (s 52 of the 1987 Act).
On 30 September 2011, Mr Simon’s solicitors claimed on his behalf lump sum compensation under s 66 of the 1987 Act in the sum of $181,500 in respect of a 65 per cent whole person impairment plus $48,000 for pain and suffering under s 67.
The claim was made up of the following impairments, as assessed by Dr Flecknoe-Brown, consultant physician, in his report of 27 June 2011:
(a)     haemopoietic system 15 per cent;
(b)     left hip 7 per cent;
(c)     right upper limb 40 per cent, and
(d)     left upper limb 23 per cent.
Dr Flecknoe-Brown assessed the combined whole person impairment rating to be 65 per cent. The claim before the Commission is for 65 per cent whole person impairment and the “Body Parts/Systems” claimed at Part 5.6 of the Application to Resolve a Dispute are:
“Chapter 12 – Haemopoietic system
Chapter 3 – Left lower extremity
Chapter 2 – Right and left upper extremities”
By letter dated 7 December 2011, the insurer’s solicitors disputed liability on the ground that Mr Simon was incapacitated as a result of his non-Hodgkin’s lymphoma from 1997 and the deemed date of injury was the date of first incapacity in 1997. Accordingly, the assessments under s 66 should be under the Table of Disabilities, not under the whole person impairment scheme introduced in 2002.
The parties have agreed that Mr Simon contracted the disease of non-Hodgkin’s lymphoma in the course of his employment with the appellant, that his employment was a substantial contributing factor to his injury, that the appellant was the last employer to employ Mr Simon in employment to the nature of which the disease of non-Hodgkin’s lymphoma is due, and that the claim is subject to s 15 of the 1987 Act.
The Arbitrator held, applying Stone v Stannard Brothers Launch Services Pty Ltd [2004] NSWCA 277; 1 DDCR 701 (Stone), that the claim for whole person impairment was as a result of an injury, within s 66(1), which impairment is itself to be treated as an injury within s 15(1), as provided by s 15(4). Therefore, Mr Simon was entitled have his claim for lump sum compensation assessed under the whole person impairment scheme.
The Commission issued a Certificate of Determination on 7 January 2014 in the following terms:
“The Commission determines:
1. A finding that the applicant suffered the injury relevant for the assessment of his lump sum compensation claim on 30 September 2011.

2. The matter is remitted to the Registrar for referral to an appropriate Approved Medical Specialist(s) for the assessment of permanent impairment arising out of injuries as follows:

(a) Date of Injury: 30 September 2011

(b) Body Systems: Haematopoietic System
Left Hip
Right upper limb
Left upper limb

(c) Documents to be provided to the Approved Medical Specialist:

(i) Application to Resolve a Dispute; and
(ii) Reply.

3. The respondent is to pay the applicant’s costs as agreed or assessed with a 15 per cent uplift for complexity.

A brief statement is attached to this determination setting out the Commission’s reasons for the determination.”

The employer has appealed.

PRELIMINARY MATTERS

Interlocutory

As the Arbitrator’s decision was interlocutory, because it has not finally determined the worker’s rights to compensation (Licul v Corney [1976] HCA 6; 180 CLR 213 at 224–225), but merely decided the date of injury, leave to appeal is required.
As the appeal will determine the basis for the assessment of Mr Simon’s impairments, it is necessary for the proper and effective determination of the dispute that the Commission grant leave to appeal and I do so (s 352(3A) of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act); DP World Sydney Ltd (formerly known as Container Terminals Australia Pty Ltd) v Kelly [2011] NSWWCCPD 43 at [13]).

On the papers

Section 354(6) of 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 Nos 1 and 6; the documents that are before me, and the submissions 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.

ISSUES IN DISPUTE

The issues in dispute in the appeal are whether the Arbitrator erred in:
(a)     finding the deemed date of injury to be 30 September 2011;
(b) determining the s 66 assessments are to be expressed in terms of whole person impairment;
(c)     determining the application of cl 3 of Pt 18C of Sch 6 to the 1987 Act, and
(d)     failing to correctly apply s 15 of the 1987 Act.

THE LEGISLATION AND TRANSITIONAL PROVISIONS

Relevantly, at the time relevant to the present claim, ss 4, 15 and 16 of the 1987 Act provided:
4“ Definition of ‘injury’
(cf former s 6 (1))
In this Act:
injury:
(a)  means personal injury arising out of or in the course of employment,
(b)  includes:
(i) a disease which is contracted by a worker in the course of employment and to which the employment was a contributing factor, and
(ii)  the aggravation, acceleration, exacerbation or deterioration of any disease, where the employment was a contributing factor to the aggravation, acceleration, exacerbation or deterioration, and
(c)  ….”
“15   Diseases of gradual process—employer liable, date of injury etc
(cf former ss 7 (4), (4C), (5), 16 (1A))
(1) If an injury is a disease which is of such a nature as to be contracted by a gradual process:
(a)  the injury shall, for the purposes of this Act, be deemed to have happened:
(i)  at the time of the worker’s death or incapacity, or
(ii)  if death or incapacity has not resulted from the injury—at the time the worker makes a claim for compensation with respect to the injury, and
(b)  compensation is payable by the employer who last employed the worker in employment to the nature of which the disease was due.
…
(4) In this section, a reference to an injury includes a reference to a permanent impairment for which compensation is payable under Division 4 of Part 3.
…”
“16   Aggravation etc of diseases—employer liable, date of injury etc
(cf former ss 7 (4A), (5), 16 (1A))
(1) If an injury consists in the aggravation, acceleration, exacerbation or deterioration of a disease:
(a)  the injury shall, for the purposes of this Act, be deemed to have happened:
(i)  at the time of the worker’s death or incapacity, or
(ii)  if death or incapacity has not resulted from the injury—at the time the worker makes a claim for compensation with respect to the injury, and
(b) compensation is payable by the employer who last employed the worker in employment that was a substantial contributing factor to the aggravation, acceleration, exacerbation or deterioration.
…
(3) In this section, a reference to an injury includes a reference to a permanent impairment for which compensation is payable under Division 4 of Part 3.
….”
Clauses 1, 2 and 3 of Pt 18C of Sch 6 to the 1987 Act provide:
“1   Definitions
In this Part:
existing claim and new claim have the same meaning as in Chapter 7 of the 1998 Act.
lump sum compensation amendments means the amendments made by Schedule 3 to the Workers Compensation Legislation Amendment Act 2001 and Schedule 2 to the Workers Compensation Legislation Further Amendment Act 2001.
2   Operation of amendments generally
(1)   The Workers Compensation Acts apply to and in respect of an existing claim as if the Workers Compensation Legislation Amendment Act 2001 and the Workers Compensation Legislation Further Amendment Act 2001 had not been enacted.
(2)   This clause is subject to this Part and to any regulations under this Schedule.
3   Lump sum compensation amendments
(1) The lump sum compensation amendments do not apply in respect of an injury received before the commencement of the amendments (even if the injury is the subject of a claim made after the commencement of the amendments) except as follows:
(a)  …
(b)  …
(2) There is to be a reduction in the compensation payable under Division 4 of Part 3 (as amended by the lump sum compensation amendments) for any proportion of the permanent impairment concerned that is a previously non-compensable impairment. This subclause does not limit the operation of section 323 of the 1998 Act or section 68B of the 1987 Act.
(3) A previously non-compensable impairment is loss or impairment that is due to something that occurred before the commencement of the amendments to Division 4 of Part 3 made by the lump sum compensation amendments, being loss or impairment that is of a kind for which no compensation was payable under that Division before that commencement.
(4) ….”

SUBMISSIONS

Counsel for the appellant, Ms Woods, argued that the Arbitrator erred in finding that Pt 18C of Sch 6 provided no assistance. She submitted that the losses claimed are consequential conditions flowing from the injury, that is, the non-Hodgkin’s lymphoma, and “the appropriate date of injury should properly be the deemed date of injury for that condition”.
Ms Woods contended that, in the context of a permanent impairment injury, s 15(4) limits the reference to “injury to Section 15 and for the purposes of fixing a ‘deemed’ date of injury”. She said that “injury” in Pt 18C is meant in a broader sense and is not a reference to an arbitrary date fixed by s 15 and is not limited to the purposes of s 15.
Ms Woods argued that the reference to “injury” in Pt 18C is a reference to the injurious event or events and excludes the application of the lump sum amendments introduced by the 2001 amending Acts to claims made after 1 January 2002. If the Arbitrator’s view were accepted, the phrase “even if the injury is the subject of a claim made after the commencement of the amendments”, in cl 3 of Pt 18C, would have no work to do.
Ms Woods submitted that all of the injurious events occurred prior to 1 January 2002 and culminated in Mr Simon undergoing treatment and hospitalisation in 1997, 1998 and 1999. This interpretation is consistent with the balance of cl 3(3) of Pt 18C, which requires a deduction of the amount of compensation payable when events prior to 1 January 2002 contributed to the loss (Fleming v NSW Police Force [2011] NSWWCCPD 33 (Fleming)).
The Arbitrator’s observation (at [25] of his decision) that the appellant had not submitted on whether Mr Simon previously suffered a non-compensable impairment within cl 3(3) of Pt 18C ignored the fact that, in accordance with Fleming, any submissions on that point cannot be made until the compensation payable is ascertained and that cannot be done until an AMS has assessed the loss.
Ms Woods relied on cl 2 of Pt 18C and the definition of “existing claim” in s 250 of the 1998 Act, which commenced on 1 January 2002. That definition, which applies to Pt 18C, defines an existing claim as “a claim for compensation that is made before the commencement of this section or a related claim that is made or entitled to be made (whether before or after the commencement of this section)”. A “related claim” is a claim or further claim for compensation in respect of the same injury, whether or not the claim is in respect of the same kind of compensation (s 250). She contended that the current claim under s 66 is a “related claim” to the claim Mr Simon made for weekly compensation in 1997 and should therefore be assessed under the Table of Disabilities.
Turning to s 15, Ms Woods submitted that the first step the Commission is required to take under that section is to ascertain “whether death or incapacity from the injury has occurred”. While s 15(4) allows for a “permanent impairment injury”, on the facts in this case, taking into consideration the medical evidence, the compensation payments made, and Mr Simon’s statement, there was “clearly an incapacity flowing from that impairment in 1997 and that must be the deemed date of injury for the purposes of Section 15”. In determining that there was no evidence of incapacity flowing from the impairment, the Arbitrator failed to take into account all of the evidence.
Ms Woods argued that the appellant’s submissions are consistent with Collingridge v IAMA Agribusiness Pty Ltd [2011] NSWWCCPD 31 (Collingridge) and that the Arbitrator failed to take into consideration the determination in that case of the meaning of “injury” for the purposes of Pt 18C. She contended that Stone could be distinguished because it did not involve Pt 18C and there was no identifiable incapacity.
Last, Ms Woods submitted that the Arbitrator referred an assessment of Mr Simon’s left hip, but there is no claim for the left hip and, if the matter is to be referred to an AMS, it should be for the left lower extremity.
Counsel for Mr Simon, Mr McManamey, submitted, relying on the reasoning in Stone, that the date of injury is as found by the Arbitrator. He contended that the reasoning in SAS Trustee Corporation v O’Keefe [2011] NSWCA 326 (O’Keefe) supports this conclusion and that Collingridge has no application to the facts of the present matter.
Dealing with the meaning of “injury” in Pt 18C, Mr McManamey submitted that s 15(1)(a) deems the date of injury to be the date of injury for the purposes of the 1987 Act and, once the section has deemed the date, it is the operative date when applying the other provisions of that Act. Where, by operation of s 15, the injury is deemed to have happened after 1 January 2002, the entitlement is the amount payable at the deemed date of injury (O’Keefe; SAS Trustee Corporation v Pearce [2009] NSWCA 302).
He conceded, however, that sub-cls (2) and (3) of cl 3 of Pt 18C operate to require a monetary deduction to the extent any previously non-compensable impairment is due to something that occurred prior to 1 January 2002.
Mr McManamey said that, because of its different facts, Collingridge has no application. He conceded that the referral of the left hip was an error that the correct referral should be for the left lower extremity.

DISCUSSION AND FINDINGS

Save for one point, discussed below, which relates to cls 3(2) and (3) of Pt 18C, I do not accept Ms Woods’ submissions. It is appropriate to consider first the authorities on the disease provisions and then, in the light of those authorities, whether the Arbitrator erred in his approach or conclusion.

The authorities

In GIO Workers Compensation (NSW) Ltd v GIO General Ltd (1995) 12 NSWCCR 187 (GIO), the worker was exposed to sunlight in the course of his employment over 19 years. As a result, he developed a melanoma on his right cheek. Doctors removed the melanoma in 1983. This treatment resulted in a short period of incapacity. The worker subsequently developed a number of metastases of the melanoma. In 1993, he died from a brain tumour, which was a metastatic melanoma that had resulted from his original 1983 melanoma.
The worker’s widow claimed compensation under the 1987 Act and succeeded against the insurer on risk in 1993. The insurer appealed. It argued that, as the operation on the melanoma in 1983 had caused a period of incapacity and, as the worker’s death had resulted from the 1983 melanoma and there was no evidence that exposure to sunlight since 1983 had played any role in the worker’s death, s 15(1) deemed the injury to have happened at the time of the incapacity in 1983.
Sheller JA said (at 195F–G) (Priestley and Clarke JJA agreeing):
“But, if the injury resulted in incapacity for work and the worker’s death, is it deemed to have happened at the time of the worker’s death or at the time of the worker’s incapacity for work? The appellant submitted that the answer was incapacity for work if that resulted. The injury is only deemed to have happened at the time of the worker’s death if it did not result in incapacity for work before death. In 1983, the operation on the melanoma resulted in incapacity for work. The appellant submitted that, pursuant to section 15(1), the injury was deemed to have happened at that time and that, accordingly, within the meaning of Part 3, clause 2(1), the worker’s death resulted from an injury received before the commencement of Division 1 of Part 3 and the amount payable was that under the former Act.” (emphasis added)

In rejecting this argument, Sheller JA held (at 196G) that “for the purpose of the widow’s claim, the worker’s injury is deemed to have happened at the time of his death”. His Honour said at 196B:
“In the case of the worker’s claim, the injury, being a disease of such a nature as to be contracted by a gradual process, is deemed to have happened at the time of incapacity. I have no doubt that is a reference to the incapacity for which compensation is claimed. Section 15(1)(b) provides that ‘compensation is payable by the employer in whose employment the worker is or who last employed the worker’. That means the employer in whose employment the worker is at the time the injury is deemed to have happened, or who last employed the worker before the injury is deemed to have happened; Fisher v Hebburn [1961] HCA 16; 105 CLR 177 at 196 and 199.” (emphasis added)
In Alto Ford Pty Ltd v Antaw [1999] NSWCA 234; 18 NSWCCR 246 (Antaw), the worker was a motor mechanic who was injured in 1976 while working for Alto Ford when a metallic particle struck his left eye. He settled his claim under s 16 of the Workers’ Compensation Act 1926 (the 1926 Act) for 10 per cent loss of sight in the left eye. The worker moved to different employers and, in 1992, he had further surgery to his eye and was incapacitated for a period but returned to work. In April 1996, he ceased full-time work as a mechanic because of his loss of vision.
The worker claimed weekly and lump sum compensation on 29 July 1996 against Alto Ford and was awarded weekly compensation from 10 August 1993 (incapacity having arisen in January 1992 when he had time off work for surgery and was paid voluntary compensation) and lump sum compensation in respect of a further 40 per cent loss of sight in his left eye calculated on a deemed date of injury of 29 July 1996.
Alto Ford appealed. It argued three points: first, that it was not the employer who last employed Mr Antaw in employment to the nature of which the disease was due; second, that the injury should have been deemed to have happened on or before 30 June 1987 and lump sum compensation calculated under s 16 of the 1926 Act, and, third, as the trial judge found an incapacity in January 1992, that was the deemed date of injury under s 15(1)(a)(i) and the section did not permit her Honour to deem the date of injury for the purpose of s 66 to be 29 July 1996.
Before considering the Court of Appeal’s decision, it is important to understand that, though the initial injury was a one-off traumatic event that occurred when a piece of metal entered the worker’s left eye, the injury was, for the purposes of s 15(1), deemed to be a disease of such a nature as to be contracted by gradual process (s 15(3)).
Sheller JA (Meagher JA and Cole AJA agreeing) delivered the judgment of the Court.
The first point (dealt with second by Sheller JA, at [19]–[23]) turned on the meaning of the expression “employment to the nature of which the disease was due”. As this issue does not arise in the present matter, it can be put to one side.
As to the second point, counsel for the appellant argued that no practical purpose was to be served by applying s 15 of the 1987 Act where the worker had suffered a frank traumatic injury and there was no difficulty in identifying the date of the injury from which the incapacity arose. It was also argued, as the appellant in the present matter has argued, that the evidence established a deemed date of injury under s 15 before 30 June 1987 because the worker had been incapacitated for work in 1976 and when he first stopped work because of his vision in 1985.
The Court held that the trial judge’s finding that the injury was deemed to have happened at the time of incapacity in 1992, when the worker was unable to work as a motor mechanic, was open to her. However, by 1996, the worker had sustained a further 40 per cent loss of vision. The worker’s incapacity had not resulted from that additional loss of vision and the appropriate date to determine the further lump sum entitlements was the time when the worker made his claim for lump sum compensation.
In rejecting the employer’s second point, Sheller JA said at [15]:
“Section 15(4) provides that in s 15 a reference to an injury includes a reference to a loss or impairment for which compensation is payable under Div 4 of Pt 3 [of the 1987 Act]. Loss of vision is such a loss; see s 66 and the Table to Div 4 of Pt 3 therein referred to. The combined effect of subs (3) and (4) means that the condition for the application of subs (1) of s 15 is met. The respondent suffered an injury within the meaning of s 15, namely, loss of vision which was a disease which was of such a nature as to be contracted by a gradual process. Accordingly, the injury is, for the purposes of the Act, if incapacity has resulted, and since the respondent is alive, deemed to have happened at the time of incapacity; s 15(1)(a)(i). Her Honour found that this incapacity occurred, other than for the purpose of s 66, in 1992 and for the purpose of s 66 in 1996.”
His Honour observed (at [18]) that s 15(1)(a) speaks of incapacity that has resulted from “the injury”, that is, “the injury referred to in the condition which makes the subsection applicable”. His Honour added:
“Thus, if the injury is loss of vision measured by Dr Higgins in September 1991, and the incapacity is that described by Dr Higgins in March 1992 when he said that the respondent found himself unable to work on motor vehicles, then that is the incapacity which determined fictionally when the injury happened. That must have been after 30 June 1987.”
Dealing with the third point, his Honour said (at [25]) that, because the relevant incapacity had not resulted from the additional loss of vision, the trial judge had not erred in finding a deemed date of injury in 1996 in respect of the claim for additional lump sum compensation. His Honour rejected the argument that the purpose of s 15(1)(a) was to fix “one date for the happening of the injury” (the injury being a loss of vision of such a nature as to be contracted by a gradual process). If that argument were correct, his Honour observed that compensation for the further loss of vision after 1992 would be denied. The trial judge correctly fixed the date of injury for the claim for additional lump sum compensation:
“on the basis contemplated by s 15(1)(a)(ii) that incapacity had not resulted from that additional loss of vision and accordingly the appropriate time was the time that the respondent [worker] made his claim for compensation with respect to the injury.” ([25])
In P & O Berkeley Challenge Pty Ltd vAlfonzo [2000] NSWCA 214; 49 NSWLR 481 (Alfonzo), the worker developed pain in her arms and neck in the early 1990s while working for the first employer. Her doctor put her off work in 1993 and the insurer paid weekly compensation (the first incapacity). She moved to the second employer, where her symptoms worsened and she again had time off work in 1995 and was paid compensation (the second incapacity). She worked for two weeks in February 1996 but ceased work again and did not return (the incapacity for which the worker claimed compensation). The second employer changed insurers after 31 December 1995.
Mrs Alfonzo claimed weekly and lump sum compensation from both employers in an application filed in the Compensation Court on 30 July 1997. The trial judge held that the incapacity for which compensation was claimed occurred when the worker ceased work in February 1996, and that was the deemed date of injury for both weekly and lump sum compensation.
The issue on appeal was which of the second employer’s insurers should bear its liability. The Court of Appeal upheld the trial judge’s decision. The relevant deemed date of injury was not the date of the first incapacity but was the date of the incapacity for which compensation was claimed or entitled to be claimed. The relevant deemed date of injury for the claim for lump sum compensation was not the date of claim (30 July 1997) but the date of incapacity for which compensation was claimed or entitled to be claimed (February 1996).
Priestley JA (Clarke JA agreeing) referred (at [32]) to s 16(3) of the 1987 Act (which is in the same terms as s 15(4)) and said that it:
“appears reasonably plainly to serve the function of fixing dates for injuries entitling a worker to compensation payable under Division 4 of Pt 3, that is, necessarily including amounts payable under ss 66 and 67.”
The Court of Appeal considered GIO, Antaw and Alfonzo in Stone. In Stone, the worker developed skin cancer as a result of prolonged exposure to sun in the course of his employment with the respondent up to 16 December 1985, when he stopped work for unrelated reasons. Prior to stopping work, he was aware of sunspots, which his doctor burnt off.
The worker’s condition deteriorated and he claimed lump sum compensation in respect of severe facial disfigurement in December 2001, which he amended on 10 June 2003. The trial judge held that the treatment given before 30 June 1987 would have involved some incapacity for work and therefore the deemed date of injury was before 30 June 1987 and the provisions of s 16 of the 1926 Act applied in assessing the quantum of compensation recoverable.
The Court of Appeal held that the trial judge had erred. As there was no claim or entitlement to claim weekly compensation, s 16(1)(a)(i) did not fix a date on which the impairment injury happened. That date was, in the circumstances of the case, fixed when the worker claimed lump sum compensation in December 2001 or on 10 June 2003. Handley JA noted (at [8]) that Antaw is authority for the proposition that s 16 of the 1987 Act “may fix different dates for incapacity and impairment injuries”.
With respect to Alfonzo, his Honour noted at [9] and [10]:
“9. ... the appeal did not require the Court to choose between 11 February 1996 and 30 July 1997 as the date of injury for the purposes of the ss 66 and 67 claims but between dates before and after 31 December 1995 when the appellant insurer came on risk.
10. In the present case where there was and could be no claim for weekly compensation s 16(1)(a)(i) did not fix a date on which the impairment injury happened. Accordingly s 16(1)(a)(ii) applied and this injury is deemed to have occurred when the claim for lump sum compensation was made. Even if s 16(1)(a)(i) was capable of operating in this case to fix a date for the worker’s incapacity injury we should nevertheless follow the Alto Ford [Antaw] case where this Court specifically held that s 16(1) could fix different dates for incapacity and impairment injuries and, in the latter case the relevant date was the date of the claim.” (emphasis added)
Hodgson JA (Mason P agreeing) reached the same conclusion, adding at [36]–[38]:
“36. In my opinion, the decision in GIO shows that one must relate the question of the time of death or incapacity under s.16(1)(a)(i) to what is being claimed. Where, as in GIO itself, what is being considered is not a worker’s claim based on incapacity, but a dependant’s claim based on death, the fact that there was incapacity prior to the worker’s death is irrelevant. The relevant time for the purposes of s.16(1)(a)(i) is the time of death.
37. Berkeley Challenge [Alfonzo] shows that, if the claim under consideration is for weekly compensation based on incapacity, the relevant incapacity for the purposes of s 16(1)(a)(i) is incapacity giving rise to entitlement to weekly compensation. Thus, in such a case, incapacity first occurs when the physical incapacity results in some loss of wages, even if there had previously been incapacity in the Arnotts sense, not resulting in any loss of wages.
38. In the present case, the claim for facial disfigurement is a claim for a loss of a thing as the result of an injury, within s 66(1), which loss is itself to be treated as an injury within s 16(1), as provided by s 16(3). The same applies to the claim in respect of bodily disfigurement. Each such loss or injury was the disfigurement assessed by Dr Lobel on 5 March 2003, and included in the amended claim on 10 June 2003; and thus could not have caused incapacity prior to 30 June 1987: in my opinion, this plainly follows from Antaw at par [18]. For that reason, in my opinion the primary judge did make an error of law, and the appeal must be upheld.” (emphasis added)
Applying the principles in Antaw, as explained in Stone, s 16 (and, I would add, s 15, which is relevantly in the same terms) can “fix different dates for incapacity and impairment injuries” (per Handley JA in Stone at [10]).
The Court of Appeal again considered the disease provisions in O’Keefe. In that case, the worker, a former Sergeant in the NSW Police Service, was discharged from the Police Service in July 2006 because he was incapable of performing ordinary police duties due to a degenerative condition in his lumbar spine. A certificate issued, in April 2006, under s 10B(3)(a) of the Police Regulation (Superannuation) Act 1906 (NSW) (the Superannuation Act), certified that the infirmity was caused by Mr O’Keefe being “hurt on duty”, with dates of injury specified as 1 April 1998, 21 January 1999 and a final incident on 31 May 2005.
On 8 November 2007, Mr O’Keefe applied for a “gratuity”, being a lump sum compensation payment. Such gratuities are calculated in accordance with provisions in Divs 3, 4 and 5 of Pt 3 of the 1987 Act (which include s 66 of the 1987 Act). The 2001 amending Acts were relevant and, given the nature of Mr O’Keefe’s condition (a degenerative condition of the spine), so too were the disease provisions.
On 19 January 2009, the Commissioner’s delegate decided, under s 12D(4) of the Superannuation Act, that Mr O’Keefe’s back injury had been caused by him being hurt on duty. The date of injury was described as “Nature and Conditions of employment between 28 July 1988 and 24 November 2005”. Handley AJA held (at [65]) that the delegate’s hurt on duty decision identified a single injury caused by the nature and conditions of Mr O’Keefe’s employment over a 17 year period and that was the only injury for which he was entitled to compensation. This was so notwithstanding that he had suffered back injuries in several incidents between 28 July 1988 and 24 November 2005, some of which caused incapacity for work for which Mr O’Keefe received compensation.
The SAS Trustee Corporation (known in the relevant legislation as STC) awarded Mr O’Keefe payment of $7,500 for six per cent whole person impairment due to injuries to his lumbar spine. Mr O’Keefe appealed to the District Court and was awarded $34,075. The trial judge found that Mr O’Keefe first suffered injury and incapacity on 28 July 1988, and suffered further injuries and incapacity on 2 June 1998 and 27 January 1999. He said that s 16 of the 1987 Act “deems injury to have occurred” at each of those dates so that Mr O’Keefe was entitled to claim lump sum compensation “if permanent impairment resulted from the injury”. He found that Mr O’Keefe’s right to lump sum compensation for an injury accrued when that injury caused incapacity and that “there were multiple injuries before 1 January 2002” which could be aggregated.
SAS appealed. It argued that the claim came within s 16, which deemed the injury to have happened on 8 November 2007, the date on which Mr O’Keefe claimed lump sum compensation.
In upholding the appeal, Handley AJA (McColl JA agreeing), noted (at [90]) that Mr O’Keefe had been paid compensation for all time lost due to incapacity prior to 24 November 2005 and that his claim was (only) for lump sum compensation. His Honour said (at [94]) that the question was whether the date of injury was fixed by the date of incapacity, in accordance with s 16(1)(a)(i), as the judge held (and the appellant has contended in the present appeal), or by the date of the claim for lump sum compensation, in accordance with s 16(1)(a)(ii), as Mr O’Keefe contended.
Citing GIO, Alfonzo, and Stone, Handley AJA noted (at [95]) that the Court has decided that incapacity in s 16(1)(a)(i) means incapacity for which weekly compensation is or can be claimed. His Honour added, at [96]:
“These cases also decided that s 16(1)(a)(i) only applies to a claim for weekly compensation, and that the section fixes different dates of injury for different purposes. In GIO at 196 Sheller JA, who gave the principal judgment said, of the comparable provision in s 15(1)(a)(i), that the reference to incapacity was ‘a reference to the incapacity for which compensation is claimed’. He added (p 196) that whether there was an incapacity or death claim ‘In neither case does it matter that there were earlier periods of incapacity resulting from the injury’.”
After referring to various passages from GIO, Alfonzo, Stone and Antaw, which have been set out in greater detail earlier in this decision, Handley AJA explained, at [101], that the cases:
“establish that if the claim is for lump sum compensation any earlier claim for weekly compensation is irrelevant. Any injury by permanent impairment (s 16(3)), is deemed to have happened when the lump sum claim is made.”
Even though, like Mr Simon, Mr O’Keefe had had previous periods of incapacity, for which compensation had been claimed and paid, Handley AJA held (at [104]) that those periods of incapacity were irrelevant. His Honour concluded, at [105]:
“Since the claim fell within s 16(1)(a)(ii) the injury was deemed to have happened on 8 November 2007, and thus, for the purpose of the transitional provisions, after the lump sum compensation amendments took effect on 1 January 2002. The Judge erred in law in concluding otherwise.”

Did the Arbitrator err in his approach or conclusion?

The Arbitrator’s reasoning in the present matter is perfectly consistent with the above authorities and, but for the reference to the left hip in the proposed referral to the AMS, discloses no error.
The Arbitrator said that cl 3 of Pt 18C merely states the issue for determination, that is, whether, in relation to Mr Simon’s claim for lump sum compensation, the “injury [was] received before the commencement of the amendments” in the 2001 amending Acts. He (correctly) noted that the answer to that question will depend on the facts in each case and will be different for a personal injury (s 4(a)) (described by the Arbitrator as a “frank injury”) and for “disease type injuries” (s 4(b)(i) and (ii)).
Consistent with the authorities (see Crisp v Chapman (1994) 10 NSWCCR 492), the Arbitrator acknowledged that s 15 does not create an injury and that the existence of a compensable injury only arises once the worker has passed the tests in ss 4 and 9A of the 1987 Act. It was not disputed that Mr Simon had established injury within those sections. The question the Arbitrator posed was, for the purpose of Mr Simon’s claim for lump sum compensation, what was the date of injury. That was undoubtedly the correct question.
The Arbitrator (correctly) did not accept the appellant’s submission that the claimed losses are “consequential losses”, noting there is a distinction between incapacity and impairment, which is something for which the legislation provides. He added that this is not a case of a consequential injury in the “ordinary sense” ([29]). That was because the pathologies from which Mr Simon suffers are a direct sequelae of his non-Hodgkin’s lymphoma. They are not akin to, for example, an overuse of the left arm causing pathology in that arm as a consequence of an initial injury to the right arm. This approach discloses no error.
Turning to Collingridge, the Arbitrator said that the appellant’s reliance on that decision was “off the point” ([31]). He said that that case was decided in circumstances where there had been a prior claim for lump sum compensation (made before 1 January 2002) with a deemed date already fixed as a result of that claim and, when dealing with a later claim for additional lump sum compensation (made after 1 January 2002), it was not open “to determine a further date of injury for that further lump sum claim”.

That was a correct understanding of Collingridge, which was determined on its own facts. Those facts were that there had been a previous judicial determination (made before 1 January 2002) of the date of injury for a claim for lump sum and weekly compensation. Because his condition deteriorated, Mr Collingridge subsequently made a claim, after 1 January 2002, for additional lump sum compensation. It was held (at [83]) that once the disease provisions had been applied to determine the deemed date of injury for a claim for lump sum compensation, as they had been in the previous judicial determination, there was no scope to apply them again to produce a different date of injury with respect to the later claim for additional lump sum compensation.
As the Arbitrator noted, the incapacity in Collingridge was a result of the first permanent impairment, which occurred at or around the time of the first claim. As Mr Simon has not made a previous claim for permanent impairment, his previous incapacity is irrelevant (Stone at [36] and O’Keefe at [101]), and the injury is the permanent impairment for which compensation is payable under Div 4 of Pt 3 (s 15(4)). As incapacity did not result from that injury, the date of injury is the time Mr Simon made his claim for compensation with respect to the injury (s 15(1)(a)(ii)).
It follows that, applying Stone and O’Keefe to the facts of Mr Simon’s case, considering the nature of the claim made, and the terms of s 15(4), Mr Simon’s injury was not received before 1 January 2002 but was received on the date of claim, namely, on 30 September 2011. Therefore, the Arbitrator correctly determined that cl 3 Pt 18C does not prevent the post 1 January 2002 provisions from applying.
It further follows that Ms Woods’ submissions about the meaning of injury in cl 3 of Pt 18C are inconsistent with binding authority and cannot be accepted. It is no answer to say that Stone did not consider Pt 18C. The Court considered cl 3 of Pt 18C in O’Keefe, and applying Stone (and the other authorities referred to above), reached the same conclusion. If there is any inconsistency between O’Keefe and Collingridge, and I do not believe there is, the Commission is (naturally) bound to apply O’Keefe.
The submission that, on the evidence, there was “clearly an incapacity flowing from”

Mr Simon’s impairment in 1997 is, in the light of the authorities, untenable. Though Mr Simon no doubt suffered from various symptoms in 1997, his impairment was not assessed and claimed until 2011. As previously noted, where what is being considered is not a worker’s claim based on incapacity, but is a claim based on impairment, the fact that there was incapacity prior to the permanent impairment claim is irrelevant.
I do not accept the submission that, if the Arbitrator’s view of the meaning of injury in cl 3 of Pt 18C were accepted, the phrase “even if the injury is the subject of a claim made after the commencement of the amendments” in that clause, would have no work to do. It clearly applies to personal injuries received before 1 January 2002. If a worker receives a s 4(a) personal injury before 1 January 2002, but does not claim lump sum compensation until after that date, the claim will be assessed under the Table of Disabilities.
Ms Woods’ reliance on cl 2 of Pt 18C does not assist the appellant. Under cl 224 of the Workers Compensation Regulation 2003 (the 2003 Regulation), on and from 1 April 2002 “each existing claim in respect of which there is no pending application for determination by the Compensation Court is to be treated as a new claim for the purposes of the Workers Compensation Acts (under cl 5 of Pt 18C of Sch 6 to the 1987 Act)”.
As Mr Simon had no pending application for determination by the Compensation Court as at 1 April 2002, his previous claim is, under cl 224, to be treated as a new claim. The Workers Compensation Regulation 2010 (the 2010 Regulation) repealed the 2003 Regulation. However, by cl 186 of the 2010 Regulation, “[a]ny act, matter or thing that, immediately before the repeal of the Workers Compensation Regulation 2003, had effect under any of that Regulation continues to have effect under this Regulation”.
In light of these Regulations, Ms Woods’ reference to Mr Simon’s claim for lump sum compensation being a “related claim” to the claim he made for weekly compensation in 1997, and therefore to be determined as if the 2001 amending Acts had not been enacted, has no substance. Even without the Regulations, s 15(4) makes it clear that the claim for lump sum compensation is not a claim “in respect of the same injury” and it is therefore not a “related claim”.
One further issue arises. That issue relates to cls 3(2) and (3) of Pt 18C, which require a reduction in the compensation payable under Div 4 of Pt 3 (as amended by the 2001 amending Acts) for any proportion of the permanent impairment concerned that “is a previously non-compensable impairment”. A previously non-compensable impairment is defined in cl 3(3) of Pt 18C as a loss or impairment that is due to “something that occurred” before 1 January 2002, being a loss or impairment that is of a kind for which no compensation was payable under that Division (Div 4) before 1 January 2002.
The impairment due to the effect of the injury on Mr Simon’s haemopoietic system is a loss or impairment of a kind for which no compensation was payable under Div 4 of the 1987 Act before 1 January 2002, that is, it is a loss that does not appear in the Table of Disabilities. Significantly, the deduction does not depend on when the injury occurred, but applies when the loss or impairment is due to “something that occurred” before 1 January 2002.
As Mr Simon’s impairment due to his haemopoietic system has occurred due to something that occurred before 1 January 2002, namely, his exposure to petrol up to 1996, and, as no compensation was payable for that loss under the Table of Disabilities, the compensation payable must be reduced by the proportion of the permanent impairment that is due to the impairment of Mr Simon’s haemopoietic system. This does not, however, apply to his other impairments, which relate to impairments due to the condition of his left lower extremity and his right and left upper extremities, all of which were losses of a kind for which compensation was payable under the Table of Disabilities.
The reduction in compensation for a previously non-compensable impairment is to be effected by a reduction “in the compensation payable”, not by a reduction in degree of whole person impairment (Fleming at [89]; SAS Trustee Corporation v Schmidtke [2012] NSWCA 269 at [20]). As Ms Woods submitted, an AMS must assess the degree of whole person impairment before the reduction can be made. However, an Arbitrator must make the reduction, which determines the amount of compensation payable, if the parties are unable to reach agreement.
The Arbitrator wrongly said (at [25]) that Ms Woods had not argued that Mr Simon suffered a previously non-compensable impairment. Ms Woods raised that issue (at T10.4) at the arbitration, but the Arbitrator may (understandably) have understood it as a submission that Mr Simon was entitled to no permanent impairment compensation. If that was what Ms Woods meant, for the reasons explained above, her submission was incorrect. However, there must be a reduction because of the previously non-compensable impairment due to the effect of the injury on Mr Simon’s haemopoietic system, which is a previously non-compensable impairment due to “something that occurred” before 1 January 2002.
Last, the parties agreed that the Arbitrator erred in asking the AMS to assess Mr Simon’s left hip and agree that the correct referral should be for the left lower extremity.

CONCLUSION

The Arbitrator’s substantive decision discloses no error. He correctly applied the principles discussed in Stone. Those principles have been further considered and applied by the Court of Appeal in O’Keefe, a case in which the Court expressly considered Pt 18C. He also properly distinguished Collingridge, which was determined on different facts.

DECISION

Save for amending paragraph 2(b) to delete “Left Hip” and to insert “Left lower extremity”, the Arbitrator’s determination of 7 January 2014 is confirmed.

COSTS

The appellant employer is to pay the respondent worker’s costs of the appeal, as agreed or assessed.

Bill Roche
Deputy President

23 April 2014

I, CYNTHIA BENITEZ, CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF BILL ROCHE, DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.

ASSOCIATE