Sapina v Coles Myer Limited (No.2)
[2009] NSWWCCPD 56
•18 September 2007
| WORKERS COMPENSATION COMMISSION | |||||||||
| APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR FOLLOWING REMITTER FROM THE COURT OF APPEAL | |||||||||
| STATUS: Determined on remitter: See Sapina v Coles Myer Limited [2009] NSWCA 71 | |||||||||
| CITATION: | Sapina v Coles Myer Limited (No.2)[2009] NSWWCCPD 56 | ||||||||
| APPELLANT: | Sylvia Sapina | ||||||||
| RESPONDENT: | Coles Myer Limited | ||||||||
| INSURER: | Self insured | ||||||||
| FILE NUMBER: | WCC4331-07 | ||||||||
| ARBITRATOR: | Ms R. Dupont | ||||||||
| DATE OF ARBITRATOR’S DECISION: | 18 September 2007 | ||||||||
| PRESIDENTIAL MEMBER ON APPEAL: | Acting President G Byron | ||||||||
| DATE OF FIRST APPEAL DECISION: | 18 January 2008 | ||||||||
| DATE OF COURT OF APPEAL DECISION: | 6 April 2009 | ||||||||
| DATE OF SECOND APPEAL DECISION: | 21 May 2009 | ||||||||
| SUBJECT MATTER OF DECISION: | Section 353(3) of the Workplace Injury Management and Workers Compensation Act 1998; remitter from Court of Appeal; section 11A of the Workers Compensation Act 1987. | ||||||||
| PRESIDENTIAL MEMBER ON REMITTER: | President, His Hon. Judge G. Keating | ||||||||
| HEARING: | On the papers | ||||||||
| REPRESENTATION: | Appellant: | Walker Legal | |||||||
| Respondent: | Lander and Rogers | ||||||||
| ORDERS MADE ON APPEAL: | 1. The Arbitrator’s Certificate of Determination dated 18 September 2007 is revoked. 2. The matter is remitted to a different arbitrator to be re-determined. 3. Costs of the first arbitration, the arbitral appeal before Acting President Byron, and this appeal on remitter, are to follow the orders made when the matter is re-determined. | ||||||||
BACKGROUND TO THE APPEAL
On 14 June 2007 Ms Sapina, the appellant, filed an ‘Application to Resolve a Dispute’(‘the Application’) in the Workers Compensation Commission (‘the Commission’), claiming weekly payments of compensation from 18 February 2007 to date and continuing. The respondent to the Application and on appeal is Coles Myer Limited.
A conciliation and arbitration was held before Arbitrator Dupont on 16 August 2007. In a reserved decision on 18 September 2007 the Arbitrator found in favour of the respondent employer.
On 16 October 2007 Ms Sapina sought leave to bring ‘Appeal against Decision of Arbitrator’ against the Arbitrator’s decision. Acting President Byron determined the appeal on 18 January 2008. He ordered that the decision of the Arbitrator of 18 September 2007 be revoked and made the following orders in its place:
“1. Award for the Respondent Employer (but for different reasons to those given by the Arbitrator).
2. No order as to costs”
Ms Sapina appealed to the Court of Appeal. The appeal was heard on 12 March 2009. In a decision dated 6 April 2009 (Sapina v Coles Myer Limited [2009] NSWCA 71) the Court upheld Ms Sapina’s appeal.
The background to this matter was conveniently summarised by Allsop P and Hoeben J at [5]- [16]:
“5. The respondent (Coles Myer) employed the appellant (Ms Sapina) in July 1997 as a shop assistant in the delicatessen of its supermarket at Merrylands. Two and a half years later, Ms Sapinarequested a transfer to the Epping store where she was appointed to the position of Delicatessen Manager, supervising eight other people. Some time later her marriage broke up and she sought a further transfer to the Cambridge Gardens store so that she could be near her sons. Some difficulties occurred at work at Cambridge Gardens.
6. At the Cambridge Gardens store Ms Sapina submitted a complaint to the human resources section of Coles Myer, alleging that the store manager had discriminated against her and bullied her. As a result of her complaint she was transferred to the position of Delicatessen Manager at the St Marys store in April 2004. She claimed that within two weeks that the store manager’s behaviour towards her made her feel belittled and uncomfortable. Subsequently, she submitted a claim for payment of workers compensation, which was rejected.
7. Ms Sapina took nine weeks off work, and upon her return to duty in June 2004, she was informed that the store manager had transferred to another location. She gave evidence that everything was fine until September 2006 when a new store manager and a store support manager were appointed. Ms Sapina claims that she did not get along with the new store support manager from the outset and that this person was rude to her.
8. In mid September Ms Sapina suffered what was described as a “heart scare” when she thought that the store manager was not happy with her. She said that the store manager harassed her over minor issues and her inability to meet her daily task list. Ms Sapina attributed this primarily to staff shortages at the store.
9. On 5 January 2007 the regional department manager visited the St Marys store and Ms Sapina was informed that she had failed to date some stock and to remove a box of stock on which the date endorsed on it, had expired. On 8 January 2007 the area manager and the store manager inspected the delicatessen and subsequently, the store support manager informed Ms Sapina that she would be required to attend performance counselling. Following the counselling, she went on sick leave and subsequently submitted a claim for payment of workers compensation, claiming to have incurred a psychological injury at work. Ms Sapina has not returned to work since 9 January 2007.
10. Coles Myer disputed the claim for workers compensation and the matter was in due course allocated to an Arbitrator. A hearing took place before the Arbitrator who delivered her decision on 18 September 2007.
11. The Arbitrator found as follows:
“On 9 January 2007 Ms Sylvia Sapina received a psychological injury for which employment with Coles was a substantial contributing factor.
Compensation is not payable because the injury arose out of reasonable actions taken by the employer to undertake performance management.”
12. In reaching that decision it was necessary for the Arbitrator to apply the provisions of the Workers Compensation Act 1987 (NSW) (WCA), ss 9A and 11A. Those sections relevantly provide:
“9A(1) No compensation is payable under this Act in respect of an injury unless the employment concerned was a substantial contributing factor to the injury. ...
11A(1) No compensation is payable under this Act in respect of an injury that is a psychological injury if the injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by or on behalf of the employer with respect to transfer, demotion, promotion, performance appraisal, discipline, retrenchment or dismissal of workers or provision of employment benefits to workers.”
13. Central to the Arbitrator’s conclusion was her finding:“That the counselling session held on 8 January 2007 is the most significant contributing factor to her injury and but for that event she would still be at work.”
It was common ground in the appeal to the Presidential member that the Arbitrator had at no point in time expressed her conclusions in terms of whether Ms Sapina’s injury was “wholly or predominantly caused by” the counselling session. The Arbitrator found that the counselling session constituted “reasonable action” taken by Coles Myer.
14. In the appeal to the Presidential member under WIM Act, s 352 the appellant did not challenge the Arbitrator’s application of s 9A, but complained that the Arbitrator had omitted to state her understanding of the “whole or predominant cause” requirement in the WCA s 11A. The appellant also complained that the Arbitrator’s findings of fact could not satisfy the relevant causation test.
15. The Presidential member dealt with the appeal under s 354(6). Accordingly, the Presidential member had before him the same material as was before the Arbitrator together with additional submissions from the parties relating to the appeal. In his reasons he indicated that he was satisfied that he had sufficient information to proceed “on the papers” without holding any conference or formal hearing.
16. The Presidential member handed down his decision on 18 January 2008. He dismissed the appeal and entered an award in favour of Coles Myer.”
ON THE PAPERS
Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) provides:
“(6) If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”
Having regard to Practice Directions Numbers 1 and 6, the documents that are before me, and the submissions by the parties at the directions hearing on 15 May 2009, I am satisfied that I have sufficient information to proceed with this appeal on remitter ‘on the papers’, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances.
LEAVE TO APPEAL
Monetary Threshold
Before proceeding to deal with an appeal the Commission must determine whether the application meets the requirements of section 352 of the 1998 Act.
There is no issue that the monetary thresholds in section 352(2) are satisfied.
Time
The appeal was lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act.
I grant leave to appeal.
THE COURT OF APPEAL DECISION
In the proceedings before the Presidential member, the Presidential member described his function in the following terms:
“23. A Presidential member has a specific and limited role in the review of a
decision of an Arbitrator. A review is not a rehearing. The Presidential member is not dealing with the matter de novo and is not arriving at a fresh decision based upon all of the evidence available at a later time (Coal & Allied Operations Pty Ltd v Australian Industrial Relations Commission (2000) 203 CLR 194; Builders Licensing Board v Sperway Constructions (Sydney) Pty Ltd (1976) 135 CLR 616).
24. An Appellant must demonstrate that the decision of the Arbitrator is affected by some legal, factual or discretionary error (Allesch v Maunz (2000) 203 CLR 172; The King Island Company Limited v Deery [2005] NSWWCCPD 1) in order to enliven the Presidential member’s power to interfere with the Arbitrator’s decision pursuant to section 352(7) of the 1998 Act. Moreover, the error must be such that, but for it, a different decision should have been made (see Snow Confectionary Pty Ltd v Askin [2004] NSWWCCPD 56 (‘Askin’); Section 294 of the 1998 Act; YG & GG Minister for Community Services [2002] NSWCA 247, and Absolon v NSW TAFE [1999] NSWCA 311).”
In a joint judgment of Allsop P and Hoeben J their honours conducted an extensive and detailed examination of the relevant authority concerning the proper construction of the term “review” ([17]-[59]). Following discussion of the authorities it was stated at [57] and [58]:
“57. Whilst the new regime of dealing with workers’ compensation claims must be examined in its own statutory context, it is important to appreciate that the legislature has used a phrase that had in the prior regime, a tolerably settled meaning. Section 36 of the Compensation Court Act used the phrase “review the decision”. Subsections s 352 (1) and (5) of the WIM Act make clear that the “appeal” is to be by way of review of the decision. The notion of “review of a decision” had been clearly held in the context of the former legislation and the WIM Act to be wider that an appeal strictly so-called and encompassing a reconsideration beyond correction of error. The decision under appeal is not to be ignored, but the task of the Presidential member is, as Spigelman CJ said in Chemler, “to decide whether the original decision is wrong [that is to] decide what is the true and correct view.” This requires the Presidential member to decide for himself or herself these matters. That does not mean that there must be a de novo hearing in each case. Cases such as Watson, Boston Clothing, Litynski and AGL v Samuels made plain that this was not so under s 36 and the terms of ss 3, 352 (7) and 354 make clear that no such broad ranging factual enquiry afresh is necessarily required. The terms of the WIM Act, ss 3 and 354 and the width of the powers in s 352 (7) make clear that the Presidential member has a wide choice available as to how he or she undertakes the task of deciding for himself or herself what is the true and correct decision. As Allsop P said in Cook v Midpart, error (or lack of it) by the Arbitrator will or may be relevant to the task of the Presidential member, but it does not define the task. There is, however, an important difference in the nature of the tasks of (a) coming to the view that an Arbitrator’s view was reasonable and (b) deciding for oneself that the view of the Arbitrator is the true and correct one. In a field where evaluation of injury and evidence of incapacity can lead to different views, both or all which could be reasonably held, it is important that the parties have available to them the skill and judgment of the Presidential member reaching his or her own view on the questions involved in the decision.
58. Just as error of the Arbitrator may be relevant, so might be the advantages of the Arbitrator in seeing witnesses. Nothing we have said, and none of the cases to which we have referred, necessarily requires the Presidential member to rehear the case or to recall all the witnesses. The approach of the Presidential member as to how he or she goes about reaching his or her own decision will be a matter for him or her within the confines and freedoms of s 354.”
Applying these principles to the approach taken by the Acting President, their Honours concluded (at [55]) Beazley JA agreeing:
“55. The view that was expressed by the Presidential member in the present case that demonstration of error in the Arbitrator’s decision is a precondition of any intervention and of any action under s 352(7) was, with respect, wrong.”
Their Honours then considered each of the grounds of appeal relied upon before the Presidential member and concluded in respect of each of them that the Deputy President had failed to consider for himself whether the Arbitrator’s decision was wrong and, if so, what was the preferred or correct decision.
The Court allowed the appeal and made the following orders:
“1. Appeal allowed.
2. The orders of Acting President Byron be set aside.
3. Remit the proceedings to the Workers Compensation Commission constituted by a Presidential member to be dealt with according to law.
4. The respondent pay the appellant’s costs of the appeal.”
REMITTER FROM THE COURT OF APPEAL
Following the remitter from the Court of Appeal under section 353 of the 1998 Act I set the matter down for a directions hearing on 15 May 2009. Prior to the directions hearing I issued a Notice of Directions Hearing dated 29 April 2009 requiring that the parties representatives be in a position at the directions hearing to address on the following matters:
“1. In the determination of this matter in accordance with the reasons set out in the Court of Appeal’s decision dated 6 April 2009, whether either party will seek to adduce any additional evidence from:
(i) the Appellant;
(ii) expert witnesses;
(iii) lay witnesses, or
(iv) whether any further evidence will be required including wage material and evidence as to the weekly amount the Applicant would probably be earning but for the injury and post injury earnings, if any.
2. The need for any additional submissions.
3. Submissions as to how the matter should now proceed, including whether the matter should be:
(i) determined by a Presidential member, or
(ii) remitted to a different Arbitrator for determination,
in accordance with the reasons set out in the Court of Appeal’s decision dated 6 April 2009.”
THE DIRECTIONS HEARING 15 MAY 2009
A directions hearing was held before me on 15 May 2009. Both parties were represented by counsel. Mr Moffitt appeared for the appellant and Mr Hourigan for the respondent. Several matters emerged from the directions hearing. Mr Moffitt submitted that the matter should be remitted to an arbitrator for re-hearing. He foreshadowed an application to admit additional evidence conceding (at T6:5) that that evidence may be fresh evidence in relation to the primary issue in these proceedings, that is, the cause of the Ms Sapina’s alleged injury. He also foreshadowed an application would be made to introduce additional evidence in relation to the worker’s probable earnings and ability to earn. Remitting the matter to an arbitrator would enable the arbitrator to deal with such applications as may be made for the admission fresh evidence.
Mr Hourigan submitted that the matter should be re-determined by the presidential member and not remitted to an arbitrator. He strongly objected to the admission of any late evidence noting, quite properly, that the appellant elected to proceed with the matter before Arbitrator Dupont with the evidence that had been filed at the time of the arbitration hearing. He submitted that the matter should be re-determined by a Presidential member on the evidence relied upon by Acting President Byron.
CONSIDERATION
On this remitter under section 353(3), the first matter is for me to conduct a review in accordance with the Court of Appeal’s decision.
The appellant’s first ground of appeal is, “the Arbitrator erred in failing to state the requirement in relation to causation under section 11A of the 1987 Act.” In response, the respondent submits that the Arbitrator was not required to state the requisite elements to be considered and applied in the application of section 11A. It submits that the failure to state the text of section 11A did not result in the Arbitrator failing to consider and apply section 11A in deciding the case. Further, it submits that the failure by the Arbitrator to refer to and state the elements to be considered and applied in the application of section 11A did not lead to any error in the Arbitrator’s decision.
From paragraphs [10] – [19] of the Arbitrator’s Reasons for Decision under the heading:
“Was the Applicant’s employment the substantial contributing factor to her injury? (9A of the 1987 Act)”, the Arbitrator stated the factual and medical opinion she took into account on that issue. At paragraphs [20] - [22] of the Reasons for Decision the Arbitrator concluded:
“ 20. I accept that Ms Sapina suffered with depression for a number of years and this was not work related although over time her perception of work events or actual work events may have aggravated that condition. It is frankly very hard to believe that Coles employs so many inept managers and Ms Sapina needs to take responsibility for some of her difficulties. It would seem she was regarded as a model employee when she first started with Coles in 1997 but the evidence is clear that her performance declined over the years. There are a number of factors that might account for this. In that regard I prefer the evidence and opinion provided by Dr Anderson that the most likely basis of most of her difficulties is her sensitivity to feedback which she takes personally and that she experiences difficulty adjusting to events in the workplace.
21. Having come to that conclusion, her diagnosis of Adjustment Disorder with Depressive and Anxious Mood relates directly to the events that occurred at the performance counselling session on 8 January 2007. Even though she constantly complained of work related issues she did remain at work until the day of the counselling and by her own admission, if but for the performance counselling she would still be at work. The report of the Sydney West Area Health Service found she had experienced a situational crisis and depression following work related problems. Ms Sapina told Dr Selwyn Smith she was anxious that her employment might be terminated as a result of performance issues.
22. I find that that the counselling session held on 8 January 2007 is the most significant contributing factor to her injury and if but for that event she would still be at work. It is now relevant to decide if the actions of the employer in conducting the performance counselling session were reasonable” (emphasis added).
The Arbitrator’s findings on injury were inconsistent and ambiguous and although these passages fall under the heading purporting to deal with section 9A they are clearly findings of facts and conclusions by the Arbitrator with respect to the section 11A issues.
The Arbitrator’s comments about section 11A were not consistent with the terms of the section. Section 11A provides:
“No compensation is payable under this Act in respect of an injury that is a psychological injury if the injury was wholly or predominantly caused by reasonable action taken or proposed to be taken by or on behalf of the employer with respect to transfer, demotion, promotion, performance appraisal, discipline, retrenchment or dismissal of workers or provision of employment benefits to workers.”
The section is most specific. It only applies where the whole or predominant cause of the psychological injury was the employer’s reasonable action with respect to transfer, demotion, promotion, performance appraisal, discipline, retrenchment or dismissal of workers or provision of employment benefits to workers was reasonable. The Arbitrator had to first determine if the counselling session on 8 January 2007 fell within one of the specified matters in section 11A. Assuming, without deciding, that it is accepted that the counselling session was “performance appraisal” and/or “discipline”, the question is whether Ms Sapina’s psychological injury was “wholly or predominantly” caused by the respondent's action with respect to that performance appraisal or discipline and, if so, whether the respondent's actions with respect to the performance appraisal and/or discipline were reasonable (Manly Pacific International Hotel v Doyle [1999] NSWCA 465; (1999) 19 NSWCCR 181. The onus of proof in establishing these matters rests with the respondent (Ritchie v Department of Community Services [1998] NSWCC 40; (1998) 16 NSWCCR 727; Department of Education and Training v Sinclair (2005) 4 DDCR 206).
Without first deciding whether the respondent’s actions with respect to performance appraisal and/or discipline were the whole or predominant cause of Ms Sapina’s psychological injury, the Arbitrator’s finding that the respondent’s conduct was reasonable was otiose. For a general discussion on the principles to be applied in cases of this kind, see Smith v Roads and Traffic Authority of NSW [2008] NSWWCCPD 130 at [25]-[31] and Temelkov v Kemblawarra Portugese Sports and Social Club Ltd [2008] NSWWCCPD 96.
The finding by the Arbitrator that the events of 8 January 2007 were “the most significant contributing factor” is not the test dictated by section 11A.
The Arbitrator erred by failing to make appropriate findings of fact, and by applying the wrong test when determining the merits of the respondent’s section 11A defence. It follows that the Arbitrator’s decision should be revoked and the matter re-determined.
In light of the foregoing it is unnecessary for me to consider the further grounds of appeal.
RE-DETERMINATION
The application for review of the Arbitrator’s decision was filed nearly two years ago on 14 June 2007. The events giving rise to the application took place several years prior to that. Having considered the medical evidence and submissions at the directions hearing on 15 May 2009, I am of the view that I am not in a position to proceed to re-determine the matter for a number of reasons.
There are three possible causes of Ms Sapina’s alleged injury. First, a lengthy history of depression following the breakdown in her marriage in the early 1990s, second, the nature and conditions of Ms Sapina’s employment with the respondent including a series of conflicts with various supervisors, and last the impact of the performance counselling session of 8 January 2007.
The Arbitrator commented on the “dearth medical evidence” on the issues in dispute. That, in my view, is an understatement of the state of the evidence in this case.
There is no report in evidence from Dr Loh, Ms Sapina’s treating general practitioner who treated her from 2003 until at least 2007. In an Application to Admit Late Documents, the Arbitrator accepted Dr Loh’s clinical notes, which are hand written and almost indecipherable.
As discussed with counsel at the directions hearing, the medical evidence does not adequately address the issues in dispute.
In addition, there is no evidence before the Commission that would enable me to reliably assess Ms Sapina’s probable earnings, or her ability to earn under section 40 in the event that the matter was determined in her favour.
In these circumstances, particularly where it has been foreshadowed by the appellant’s counsel, that an application will be made for the admission of further evidence, both of a medical nature and factual evidence as to earnings, I consider it appropriate that the matter be remitted to an arbitrator for further hearing.
Whether any further evidence should be admitted in the next arbitral proceedings will be a matter for the next arbitrator, applying the relevant statutory provisions and rules. However, in view of my comments as to the state of the evidence and given the passage of time since these issues were first ventilated before Arbitrator Dupont, I consider that it would be in the interests of justice that the parties be permitted an opportunity to adduce further evidence.
Both parties should reconsider the state of the evidence before the next conciliation and arbitration. Where any fresh evidence is to be relied upon, arrangements should be made to exchange such evidence as expeditiously as possible.
CONCLUSION
Having conducted a review on the merits (per Spigelman CJ in State Transit Authority of New South Wales v Fritzi Chemler [2007] NSWCA 249; (2007) 5 DDCR 287 at [28]), I am of the view that the Arbitrator made inconsistent and ambiguous findings of fact and applied the wrong test in determining the issues under section 11A of the 1987 Act. For the reasons given in this decision the Arbitrator’s decision dated 18 September 2007 is revoked and the matter remitted to a different arbitrator for redetermination.
DECISION
The Arbitrator’s Certificate of Determination dated 18 September 2007 is revoked. The matter is remitted to a different arbitrator to be re-determined.
COSTS
At the directions hearing, counsel for Ms Sapina submitted that the respondent should pay Ms Sapina’s costs of the arbitral appeal before Acting President Byron.
Counsel for the respondent submitted that the appropriate cost order would be that the costs of the first arbitral appeal, should be costs in the cause.
Given the history of the matter, I consider that it is appropriate that costs of the first arbitration, the arbitral appeal before Acting President Byron and this appeal on remitter should follow the orders made when the matter is re-determined. I so order.
His Hon. Judge Keating
President
21 May 2009
I, MELANIE CURTIN, CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF HIS HON. JUDGE KEATING, PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
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