Schroeder v Return to Work Corporation of South Australia
[2020] SASCFC 77
•18 August 2020
SUPREME COURT OF SOUTH AUSTRALIA
(Full Court)
SCHROEDER v RETURN TO WORK CORPORATION OF SOUTH AUSTRALIA
[2020] SASCFC 77
Judgment of The Full Court
(The Honourable Chief Justice Kourakis, The Honourable Justice Stanley and The Honourable Justice Nicholson)
18 August 2020
WORKERS' COMPENSATION - PROCEEDINGS TO OBTAIN COMPENSATION - DETERMINATION OF CLAIMS - APPEALS, JUDICIAL REVIEW AND STATED CASES
WORKERS' COMPENSATION - ENTITLEMENT TO COMPENSATION - INJURY, DISEASE OR DISABILITY - OTHER MATTERS
Appeal against a decision of the Full Bench of the South Australian Employment Tribunal.
The Full Bench upheld the decision of a Deputy President dismissing three applications for review brought by the appellant with respect to determinations of the respondent, rejecting his claims for weekly payments of compensation following surgery to his lower back on 30 March 2016. The lower back injury, for which the surgery was performed, arose out of the course of his employment on 27 March 2012 (the existing injury).
The Deputy President and the Full Bench held that pursuant to cl 37 of Schedule 9 to the Return to Work Act 2014 (SA) (the Transitional Provisions and the RTW Act respectively), the appellant was entitled to weekly compensation for a loss of earnings attributable to incapacity flowing from the existing injury for a period of two years after the designated day (1 July 2015), but that after the surgery, the appellant suffered a new injury to which cl 37 did not apply, and for which s 39 of the RTW Act allowed weekly compensation for a period of no longer than 104 weeks, commencing, in accordance with s 7(6) of the RTW Act, on the date of the existing injury.
The appellant appeals on two grounds:
1. The Full Bench erred in holding that he was not entitled to any compensation by way of weekly payments after 26 March 2014 for the new injury.
2. He had an entitlement to weekly payments for the existing injury which subsisted as a compensable injury in itself, independently of the injury caused by the surgery.
Held per Kourakis CJ (Stanley and Nicholson JJ agreeing), refusing permission on ground 1 and dismissing the appeal on ground 2:
1. Permission to appeal on ground 1 is refused insofar as it challenges the correctness of the decision in Return to Work Corporation of South Australia v Watkins [2017] SASCFC 149.
2. The appellant’s construction of cl 29(2) of the Transitional Provisions, that, even though cl 29(2) expressly refers to injuries attributable to traumas occurring both before and after the designated day, it treats those injures as occurring entirely on the day of the latter trauma, is rejected.
3. The RTW Act does not expressly allow for any election of the kind for which the appellant contends.
4. The conclusion that, after the surgery was performed, the appellant had no entitlement pursuant to cl 37 for his existing injury leaves it unnecessary to decide whether or not cl 37(6) of the Transitional Provisions precluded his claim in any event because he had ceased to have any entitlement following his return to work.
Workers Rehabilitation and Compensation Act 1986 (SA) ss 30, 30A; Return to Work Act 2014 (SA) ss 7, 39, 40; sch 9 cll 29, 30, 36, 37, 48, referred to.
Schroeder v Return to Work SA [2018] SAET 168; Schroeder v Return to Work Corporation of South Australia [2019] SASC 61; Return to Work Corporation of South Australia v Watkins [2017] SASCFC 149, discussed.
Schroeder v RTWSA (Cobham Aviation Services Engineering Pty Ltd) [2016] SAET 59, considered.
SCHROEDER v RETURN TO WORK CORPORATION OF SOUTH AUSTRALIA
[2020] SASCFC 77Full Court: Kourakis CJ, Stanley and Nicholson JJ
KOURAKIS CJ: This is an appeal against a decision of the Full Bench of the South Australian Employment Tribunal (SAET). The Full Bench upheld the decision of a Deputy President of SAET dismissing three applications for review brought by the appellant, Mr Schroeder, with respect to determinations of the respondent, the Return to Work Corporation of South Australia (RTWSA), rejecting his claims for weekly payments of compensation following surgery to his lower back on 30 March 2016. The lower back injury, for which the surgery was performed, arose out of the course of his employment on 27 March 2012.
On 1 July 2015, the Workers Rehabilitation and Compensation Act 1986 (SA) (the Repealed Act) was replaced by the Return to Work Act 2014 (SA) (the RTW Act). Schedule 9 of the latter Act makes differential provision (the Transitional Provisions) for existing injuries, which are wholly attributable to trauma suffered before the designed day (1 July 2015), and new injuries, which are attributable to trauma occurring after the designated day, or to traumas occurring both before and after that day. I will refer to the injury suffered by Mr Schroeder on 27 March 2012 as the ‘existing injury’ both because it was the injury treated by the surgery and because it is common ground that it falls within the definition of an existing injury for the purposes of the Transitional Provisions. Mr Schroeder’s entitlement to weekly compensation depends on the proper construction of the Transitional Provisions and s 7(6) of RTW Act. Section 7(6) of the RTW Act deems any injury caused by the medical treatment of a compensable injury to constitute part of ‘the original work injury’ (the relation‑back requirement).
The Deputy President and the Full Bench held that:
(a)pursuant to cl 37 of the Transitional Provisions, Mr Schroeder was entitled to weekly compensation for a loss of earnings attributable to incapacity flowing from the existing injury for a period of two years after the designated day; but that
(b)after the surgery Mr Schroeder suffered a new injury to which cl 37 did not apply, and for which s 39 of the RTW Act allowed weekly compensation for a period of no longer than 104 weeks, commencing, in accordance with s 7(6) of the RTW Act, on the date of the existing injury.
The, admittedly startling, result is that Mr Schroeder’s entitlement to weekly payments for the new injury flowing from his surgery ended on 27 March 2014, about two years before that surgery was performed.
Mr Schroeder appeals to this Court against that decision on two grounds. The first is that the Full Bench erred in holding that he was not entitled to any compensation by way of weekly payments after 26 March 2014 for the new injury. In that respect, Mr Schroeder contends that the Full Bench misapplied the decision of this Court in Return to Work Corporation of South Australia v Watkins[1] (Watkins) or alternatively that Watkins was wrongly decided. I referred the question of whether Mr Schroeder should be given permission to appeal on that ground to the Full Court following Mr Schroeder’s application to renew the question of permission to appeal in respect of ground 1, which had been refused by a Judge of this Court.[2] I would refuse permission on the first ground. I would hold that Watkins was correctly decided. Mr Schroeder makes an additional contention, which was not considered in Watkins, and which would not have altered the result in that case, that the definition of ‘new injury’ in cl 29 of the Transitional Provisions outflanks the effect of s 7(6) of the RTW Act. He contends that, by reason of that definition, a new injury is deemed to have been sustained on the same date as the trauma inflicted after the designated day. I would reject that construction of the Transitional Provisions. Save for two immaterial exceptions, the definition of ‘new injury’ in cl 29 serves the limited purpose of describing those injuries which are not entitled to weekly payments of compensation pursuant to cl 37 of the Transitional Provisions. It does not affect the operation of s 7(6) of the RTW Act.
[1] [2017] SASCFC 149.
[2] Schroeder v Return to Work Corporation of South Australia [2019] SASC 61.
By his second ground, Mr Schroeder contends that in addition to such weekly payments to which he was entitled for the new injury, he had an entitlement to weekly payments for the existing injury which subsisted as a compensable injury in itself, independently of the injury caused by the surgery. He contends that that entitlement is sourced in cl 37 of the Transitional Provisions and is therefore not affected by the relation‑back requirement of s 7(6) of the RTW Act.
I would dismiss that ground. Clause 37 of the Transitional Provisions extends the entitlement to weekly compensation for two years after the designated day for workers incapacitated by an existing injury. It is common ground that Mr Schroeder was incapacitated by an existing injury at all material times until the surgery was performed, and that the surgery caused further injury, by way of both exacerbation of the original injury and in addition to it. It follows that Mr Schroeder thereafter suffered a new injury which, as I have observed, is defined to include an injury attributable to trauma sustained before and after the designated day. It also follows that Mr Schroeder thereafter lost the benefit of cl 37 of the Transitional Provisions because after the surgery his lower back injury and its related symptoms were attributable to both the trauma suffered on 27 March 2012 and the trauma of the surgery.[3]
[3] Even though it is not ultimately material, Mr Schroeder may also have suffered an injury or injuries which were attributable only to the trauma of the surgery.
Mr Schroeder’s entitlement, in respect of any injury attributable to the trauma of the surgery, was therefore governed exclusively by the substantive provisions of the RTW Act, including s 7(6) which deemed the surgery to have occurred on the date of the original injury for which it was performed, and s 39 which limited weekly payments for a period of 104 weeks thereafter.
I elaborate on my reasons below.
The facts
Mr Schroeder injured his lower back performing his work with Cobham Aviation Services Engineering Pty Ltd on 27 March 2012. He returned to work in May 2013, on duties within his residual capacity. The Deputy President was satisfied that Mr Schroeder attended for treatments and therapies between 1 May 2013 and 30 June 2015 even though he did not always make claims for loss of wages for those visits. The Deputy President found that Mr Schroeder was partially incapacitated for work between 1 May 2013 and 30 March 2016 but that, in the days immediately before 30 June 2015, Mr Schroeder was absent from work with a cold.
Mr Schroeder’s surgery was first booked for January 2016. Mr Schroeder deferred that surgery because he was told that he might not receive weekly payments of compensation whilst absent from work and he did not wish to exhaust his annual leave.
However, when the pain became unbearable, he rebooked the surgery for 30 March 2016. The medical expenses associated with that surgery were paid by RTWSA. The Deputy President found that Mr Schroeder was totally incapacitated for work for about six weeks after his surgery, and was partially incapacitated thereafter. The Deputy President found that Mr Schroeder had not yet returned to full hours of work by reason of lower back pain caused by the existing injury and the complications of his surgery.
Mr Schroeder’s evidence was that he gradually returned to light office duties for eight hour days on non-consecutive week days. He relied heavily on medication to ease his pain.
Mr Schroeder’s post-operative symptoms included:
·occasional aching in his right ankle and heel with pins and needles and numbness in his right foot and part of his left foot;
·pain in his back, right leg and, to a lesser degree, his left leg;
·continued restriction in walking;
·continued pain and discomfort in his lower back and aching in the middle of the lower part of his back at or above his belt-line;
·pain in the middle of his lower back region that runs through and across the top of his buttocks and into his buttock cheeks and the back of both thighs down to his knees, as well as just above his thighs, which continues to progress as the day wears on and which is associated with driving, performing work duties, prolonged standing and sitting;
·ongoing dry mouth symptoms; and
·pain in his upper back.
Mr Schroeder had not suffered from the last mentioned symptom before the surgery.
The claims
Mr Schroeder made three claims with respect to his incapacity following the surgery. The first (2041 of 2016) was a claim in relation to a spinal injury alleged to have occurred on 27 March 2012. RTWSA’s agent rejected the claim on the basis that Mr Schroeder did not qualify for any further payments of compensation under the Transitional Provisions because he was not incapacitated for work immediately before the designated day, having returned to work.
The second claim (2799 of 2016) was also based on a spinal injury suffered on 27 March 2012. That claim too was rejected.
Ground 2 of Mr Schroeder’s Notice of Appeal is founded on those two claims. He contends that because his claim relies only on the existing injury, neither s 7(6) nor s 39 of the RTW Act has any application and he was entitled to receive weekly payments until 30 June 2017.
The third claim (5195 of 2016) claimed weekly payments of compensation for an injury sustained on 30 March 2016 by reason of the surgery. It is a critical element of Mr Schroeder’s contentions on this appeal that a worker who suffers an incapacity caused by an existing injury, and by an exacerbation of that injury by work caused trauma, is entitled to elect to proceed on either the existing injury or the exacerbation. The third claim was rejected on the basis that s 7(6) of the RTW Act deemed the injury constituted by the surgery to be part of the original injury suffered in 2012.
Even though the third claim on its face attracts the operation of s 7(6) of the RTW Act, Mr Schroeder contends that the original injury, which that subsection deems the surgery to be part of is, by reason of the definition of ‘new injury’ in the Transitional Provisions, the surgery itself and not the existing injury. It is in that respect that he contends Watkins was wrongly decided.
The legislative provisions
Clause 29(1) of the Transitional Provisions applies the RTW Act to injuries attributable to trauma predating 1 July 2015 and to new injuries which are attributable to trauma suffered on or after 1 July 2015 unless the Transitional Provisions otherwise provide. The Transitional Provisions otherwise provide for existing injuries. However, it is convenient to first set out the applicable provisions of the RTW Act because Mr Schroeder accepts that they apply to his third claim for the injury caused by the surgery.
The first three subsections of s 7 of the RTW Act provide:
7—Injury must arise from employment
(1) This Act applies to an injury if (and only if) it arises from employment.
(2) Subject to this section, an injury arises from employment if—
(a) in the case of an injury other than a psychiatric injury—the injury arises out of or in the course of employment and the employment was a significant contributing cause of the injury; and
(b) in the case of a psychiatric injury—
(i) the psychiatric injury arises out of or in the course of employment and the employment was the significant contributing cause of the injury; and
(ii) the injury did not arise wholly or predominantly from any action or decision designated under subsection (4).
(3) In connection with the application of subsection (2) to an injury that is, or results from, the aggravation, acceleration, exacerbation, deterioration or recurrence of a prior injury (a prescribed event)—
(a) in the case of an injury other than a psychiatric injury—employment must be a significant contributing cause of the prescribed event; and
(b) in the case of a psychiatric injury—
(i) employment must be the significant contributing cause of the prescribed event; and
(ii) the prescribed event must not arise wholly or predominantly from any action or decision designated under subsection (4),
and then the injury is only compensable to the extent of and for the duration of the relevant aggravation, acceleration, exacerbation, deterioration or recurrence.
Historically, workers compensation legislation in this State, and in other interstate and international jurisdictions, provided compensation for injuries sustained in the course of, or arising out of, employment. Sections 7(1) and (2) of the RTW Act remove the first of those two alternative bases of compensability, which required no more than a temporal connection between the employment and injury. In addition, those provisions strengthen the causal connection required by the second foundation, that the injury arose out of employment. Importantly for present purposes, s 7(3) of the RTW Act also limits the entitlement to compensation for an aggravation, acceleration, exacerbation, deterioration or recurrence (compendiously an exacerbation) ‘to the extent of and for the duration of the relevant’ exacerbation. Historically, on suffering a compensable exacerbation a worker was entitled to compensation for the combined effects of the original injury and the exacerbation.
Subsections (5) and (6) of s 7 of the RTW Act provide:
(5) For the purposes of this Act, a worker’s employment includes—
…
(e) attendance at a place to receive a medical service, to obtain a medical report or certificate (or to be examined for the purpose), to receive recovery/return to work services or for the purposes of a recovery/return to work plan, or to apply for, or receive, compensation for a work injury.
(6) Any injury attributable to surgery or other treatment or service performed with due care and skill by a person professing to have particular skills and undertaken or provided while attending at a place referred to in subsection (5)(e) will be taken to constitute part of the original work injury.
Five matters should be noted. First, incapacity caused by the surgery is compensable by reason of the combined effect of sub-ss (1) and (5) of s 7 of the RTW Act. Secondly, the ‘original work injury’ referred to in s 7(6) of the RTW Act can only mean the injury for which the medical service was provided. Thirdly, the operative effect of s 7(6) of the RTW Act is to fictionally deem the surgical injury to have occurred on the date of the original injury. Fourthly, s 7(3) of the RTW Act has the effect that, insofar as the injury attributable to the surgery is an exacerbation, it subsists only for the duration and extent of the exacerbation, but by reason of s 7(6) of the RTW Act it is an integral part of the original injury. Further, insofar as the surgery causes an injury, which is independent of the original injury, it too is nonetheless deemed to constitute part of the original injury, even if it be attributable only to trauma which was sustained after the designated day. Fifthly, the purpose of the relation‑back requirement enacted by s 7(6) of the RTW Act is to preclude any extension of the limited period of entitlement to weekly payments fixed by s 39 of the RTW Act to which I next turn.
Section 39 of the RTW Act limits the entitlement to weekly payments to 104 weeks from the date of first incapacity:
39—Weekly payments over designated periods for workers other than seriously injured workers
(1) Subject to this Act, if a worker, other than a seriously injured worker, suffers a work injury that results in incapacity for work, the worker is entitled to weekly payments in respect of that incapacity in accordance with the following principles:
(a) if any period of incapacity for work occurs within the period of 52 weeks from the date on which the incapacity for work first occurs (the first designated period)—
(i) for any period during the first designated period when the worker has no current work capacity—the worker is entitled to weekly payments equal to the worker’s notional weekly earnings; and
(ii) for any period during the first designated period when the worker has a current work capacity—the worker is entitled to weekly payments equal to the difference between the worker’s notional weekly earnings and the worker’s designated weekly earnings;
(b) if any period of incapacity for work occurs within the period of 52 weeks beginning immediately after the end of the period that applies under paragraph (a) (the second designated period)—
(i) for any period during the second designated period when the worker has no current work capacity—the worker is entitled to weekly payments equal to 80% of the worker’s notional weekly earnings; and
(ii) for any period during the second designated period when the worker has a current work capacity—the worker is entitled to weekly payments equal to 80% of the difference between the worker’s notional weekly earnings and the worker’s designated weekly earnings.
(2) For the purposes of this section, the designated weekly earnings of a worker will be taken to be the current weekly earnings of the worker in employment or self‑employment (if any) but not so as to include a prescribed benefit.
(3) A worker has no entitlement to weekly payments under this section in respect of a work injury after the end of the period of 104 weeks from the date on which the incapacity for work first occurs (that is, after the end of the second designated period).
The combined operation of ss 7(6) and 39 of the RTW Act denies weekly payments of compensation to a worker who undertakes incapacitating treatment for his or her injury more than 104 weeks after they are first incapacitated for the original injury. To ameliorate the effect of s 7(6) of the RTW Act, s 40 of the RTW Act provides supplementary income support for incapacity from surgery.
40—Supplementary income support for incapacity resulting from surgery
(1) Subject to this section, an injured worker who has an incapacity for work as a result of surgery approved by the Corporation under section 33(21)(b) is entitled to weekly payments (supplementary income support payments) as provided by this section if the incapacity occurs after the end of the second designated period that applies under section 39(1)(b).
(2) Supplementary income support payments are not payable under this section in respect of any period of incapacity that occurs more than 13 weeks after the surgery concerned.
(3) Supplementary income support payments under this section are payable at the rate provided by and in accordance with section 39(1)(b) as if the period of incapacity in respect of which the payments are made occurred during the second designated period subject to any adjustments made under the regulations to take into account—
(a) changes in the CPI; and
(b) any other matter prescribed by the regulations.
I turn next to the Transitional Provisions. Clause 29 of the Transitional Provisions defines existing and new injuries:
29—General provision
(1) Subject to the other provisions of this Part, this Act applies to and in relation to—
(a) an injury that is attributable to a trauma that occurred before the designated day and that is a compensable injury under the repealed Act (an existing injury); and
(b) an injury that is attributable to a trauma that occurred on or after the designated day (a new injury).
(2) For the purposes of subclause (1), an injury that is partially attributable to a trauma that occurred before the designated day and partially attributable to a trauma that occurred on or after the designated day will be taken to be a new injury within the ambit of subclause (1)(b).
(3) Subject to the other provisions of this Part—
(a) a reference in this Act to a work injury will be taken to include a reference to a compensable injury under the repealed Act; and
(b) this Act will apply to a compensable injury under the repealed Act as if this Act had been in operation before the injury occurred.
(4) Nothing in this Part is intended to give rise to an entitlement under this Act and the repealed Act so as to give rise to double entitlements.
Clause 29(2) might have been incorporated into cl 29(1)(b) by adding the words:
… or that is partially attributable to a trauma that occurred before the designated day and partially attributable to a trauma that occurred on or after the designated day.
The result of capturing two different categories within the same paragraph is less than elegant and may explain the drafting choice of utilising an additional clause. However, as I earlier foreshadowed, Mr Schroeder contends that there is a more substantial legislative purpose. He contends that the words of cl 29(2) ‘taken to be a new injury within the ambit of subclause (1)(b)’ deem injuries attributable to traumas sustained before and after the designated day to have occurred on the date of the post‑designated day trauma, because injuries falling within cl 29(1)(b) are injuries which are attributable solely to trauma occurring after the designated day.
Clause 30 of the Transitional Provisions modifies the application of the RTW Act to existing injuries so as to preserve the compensability provisions of the Repealed Act for existing injuries. Clause 30 provides:
(1) The question about whether an existing injury is compensable will be determined under sections 30 and 30A of the repealed Act (as in existence immediately before the designated day).
(2) However, section 7(3) of this Act extends to an injury (the designated injury) that is, or results from, the aggravation, acceleration, exacerbation, deterioration or recurrence of a prior injury where—
(a) the prior injury is wholly or partially attributable to a trauma that occurred before the designated day; and
(b) the designated injury is wholly or partially attributable to a trauma that occurred on or after the designated day.
Clause 30(1) ensures that an entitlement to compensation for an injury attributable solely to trauma inflicted prior to the designated day is not retrospectively denied by the more limited bases for compensability enacted by subsections (1), (2) and (3) of s 7 of the RTW. Clause 30(1) is expressly limited to existing injuries as defined by cl 29 and, therefore, can have no application to an injury partially attributable to traumas inflicted before and after the designated day. Clause 30(2) would, therefore, better have been introduced by the words ‘for the avoidance of doubt’ than the word ‘however’. Its meaning might also have been clearer if it had retained the defined term ‘prescribed event’ from s 7(3) of the RTW Act instead of introducing the new term ‘designated injury’. The absence of any reference to s 7(6) of the RTW Act is, therefore, not an indication that that subsection does not apply to surgical exacerbations of existing injuries; its absence is explicable because s 7(6) has no bearing on the compensability criteria of ss 30 and 30A of the Repealed Act.
In any event, the effect of cl 30(2) is only to reinforce cl 29(1), which applies the RTW Act, including s 7(3), to exacerbations of existing injuries, because, on the exacerbation of an existing injury by trauma occurring after the designated day, the injury is, by definition, a new injury. As such, compensation for the exacerbation suffered after the designated day is limited to the extent, and for the duration, of the exacerbation. That is of some importance here because it means that non-surgical exacerbations of new injuries attributable only to trauma occurring after the designated day are compensable only for the duration and extent of that exacerbation. They do not initiate an additional weekly compensation entitlement of 104 weeks. Moreover, it is only such discernible increased incapacity flowing from the exacerbation which is compensable. If Mr Schroeder’s contentions are accepted, however, both surgical and non‑surgical exacerbations of existing injuries would be deemed to have been sustained on the date of the post‑designated day trauma which contributed to the exacerbation and to generate an additional 104 week entitlement from that date.
Clause 37 of the Transitional Provisions provides:
37—Weekly payments for workers
(1) In this clause—
(a) the first transitional period is the period of 52 weeks from the designated day; and
(b) the second transitional period is the period of 52 weeks beginning immediately after the end of the initial transitional period; and
(c) a reference to an entitlement period is a reference to an entitlement period under Part 4 Division 4 of the repealed Act; and
(d) a Category A worker is, in respect of an existing injury, a worker who, immediately before the designated day, was still entitled to receive a weekly payment during the first entitlement period in respect of any incapacity for work in respect of that injury; and
(e) a Category B worker is, in respect of an existing injury, a worker who, immediately before the designated day, was still entitled to receive a weekly payment during the second entitlement period in respect of any incapacity for work in respect of that injury; and
(f) a Category C worker is, in respect of an existing injury, a worker who, immediately before the designated day, was still entitled to receive a weekly payment during a period occurring after the end of the second entitlement period in respect of any incapacity for work in respect of that injury.
(2) Subject to this Part, a worker who, in respect of an existing injury, is incapacitated for work at any time during the period beginning on the designated day and ending 104 weeks from the designated day, will be entitled to weekly payments in respect of that incapacity in accordance with the following principles:
(a) if any incapacity for work occurs within the first transitional period—
(i) in the case of a Category A worker—the worker is entitled to weekly payments under section 39(1)(a)(i) or (ii) of this Act as if references to the first designated period in section 39(1)(a) were references to the first transitional period; and
(ii) in the case of a Category B worker—the worker is entitled to weekly payments under section 39(1)(b)(i) or (ii) as if references to the second designated period in section 39(1)(b) were references to the first transitional period and as if references to “80%” in section 39(1)(b)(i) or (ii) were substituted with “90%”; and
(iii) in the case of a Category C worker—the worker is entitled to weekly payments under section 39(1)(b)(i) or (ii) of this Act as if references to the second designated period in section 39(1)(b) were references to the first transitional period;
(b) if any incapacity for work occurs within the second transitional period—the worker is entitled to weekly payments under section 39(1)(b)(i) or (ii) of this Act as if references to the second designated period in section 39(1)(b) were references to the second transitional period.
(3) Subject to subclauses (4) and (5), a worker has no entitlement to weekly payments under this Act or the repealed Act in respect of an existing injury after the end of the second transitional period (and this subclause will apply instead of section 39(3) of this Act in relation to existing injuries).
(4) An entitlement under this clause has effect subject to any other provision of this Act (including any provision that applies under or subject to this Part) that provides for the suspension, reduction or discontinuance of weekly payments.
(5) Subclause (3) does not apply in relation to a seriously injured worker.
(6) To avoid doubt, a person who, before the designated day, has ceased to have an entitlement to weekly payments on account of a discontinuance under section 36 of the repealed Act is not entitled to weekly payments under this clause (or under the repealed Act).
The operative provision of cl 37 is subclause (2) which provides, by way of exception to the limit of 104 weeks from the date of first incapacity on weekly compensation prescribed by s 39 of the RTW Act, that workers suffering an existing injury will continue to be entitled to weekly compensation for incapacity in the two years following the designated day. However, by reason of cl 29(2), a worker whose injury is partially attributable to traumas sustained either side of the designated day has a new, not an existing, injury.
The decision in Watkins
In Watkins, Stanley J remarked that the primary focus of the Transitional Provisions is on existing injuries: [4]
[28]In recognising the dichotomy created for the purposes of the operation of the Transitional Provisions between existing injury and new injury, the Transitional Provisions only make two further references to new injury. That reflects the predominant purpose of the Transitional Provisions which is to regulate the way in which the RTW Act applies to existing injury.
[29]Accordingly, the provisions of clause 37 are concerned with regulating the entitlements of a worker who has suffered an existing injury, being an injury that is attributable to a trauma that occurred before 1 July 2015 and that is a compensable injury under the repealed Act. Clause 42 provides for redemptions under the repealed Act. It provides that the Transitional Provisions do not affect redemptions entered into before the designated day, but that s 42 of the repealed Act will not apply to, or in relation to, a liability under the repealed Act in respect of an existing injury. Clause 43 provides that the provisions of the RTW Act providing for lump sum compensation for loss of earning capacity do not apply to, or in relation to, an existing injury. Clause 44 provides that a person whose entitlement to compensation for non-economic loss was determined under the repealed Act in respect of an existing injury is not entitled to an assessment of compensation for non-economic loss under the RTW Act in relation to the same injury (or any other injury arising from the same trauma).
(Footnote omitted)
[4] [2017] SASCFC 149 at [28]-[29].
The only two clauses of the Transitional Provisions which apply to new injuries are cl 36 and cl 48 (dealing with the set off of medical expenses and provisional weekly payments made to a worker but to which he or she had no entitlement against compensation payable under the RTW Act). Those provisions are of no relevance to this appeal, other than to show that there is obvious work for the definition of ‘new injury’ in cl 29(1)(b) and cl 29(2) to do other than to preclude the operation of s 7(6) of the RTW Act.
Stanley J then explained the operation of cl 37 of the Transitional Provisions as follows:[5]
[33]For the disposition of this appeal, it is relevant to consider the operation of clause 37 for two reasons. First, because it regulates weekly payments which is the nature of the claim the subject of the appeal and, second, because it is clause 37(6) upon which the appellant’s argument on appeal relies. In that context, it is necessary to commence with the scheme of the repealed Act relevant to the payment of compensation by way of weekly payments of income maintenance. Section 35(8) of the repealed Act enshrined a statutory scheme of three entitlement periods for the receipt of weekly payments of income maintenance. In effect, this limited the period of entitlement and the quantum of weekly payments. Section 39 of the RTW Act reduces the number of periods in respect of which a worker could receive weekly payments of income maintenance from three under the repealed Act to two under the RTW Act. Clause 37 regulates the transition of workers from the three entitlement periods under the repealed Act to the two designated periods under the RTW Act. The text of clause 37(1) adopts the language of s 35(8) of the repealed Act. This is unsurprising as clause 37 forms part of the Transitional Provisions which are intended to regulate the transition of weekly payments from one Act to the other. That transition is regulated by the scheme enshrined in clause 37 which provides that, as at 1 July 2015, workers who were in their first entitlement period under s 35(8) of the repealed Act are treated as being within the first designated period under s 39(1)(a)(i) or (ii) of the RTW Act, and workers who were in their second or third entitlement period under the repealed Act as at 1 July 2015 are treated as being within the second designated period under s 39(1)(b)(i) or (ii) of the RTW Act. Clause 37 means workers who, prior to 1 July 2015 were ‘still entitled to receive a weekly payment in an entitlement period, in respect of any incapacity for work in respect of that injury’ are ‘entitled to weekly payments in respect of that incapacity’ in accordance with the principles prescribed in clause 37(2). Clause 37(2)(a) prescribes what the entitlement to weekly payments is for each of category A, B and C workers where any incapacity for work occurs within the first transitional period. Clause 37(2)(b) prescribes what the entitlement to weekly payments is where any incapacity for work occurs within the second transitional period. The provisions of clause 37 apply to workers in each of categories A, B and C who claim weekly payments ‘in respect of an existing injury’. The entitlement to weekly payments under clause 37 is an entitlement ‘in respect of an existing injury’.
[5] Return to Work Corporation of South Australia v Watkins [2017] SASCFC 149 at [33].
In Watkins, the Court found that the injury was a new injury because it was partially attributable to trauma sustained after the designated day. It held, therefore, that cl 37(6) of the Transitional Provisions, which was limited to existing injuries, had no application. Stanley J, with whom the other members of the Court agreed, explained the operation of the provisions of the RTW Act on a new injury attributable in part to surgical treatment as follows:[6]
[40]In this case, as a matter of fact, the relevant injury, being the surgical injury, was a new injury, either because it was an injury attributable to a trauma that occurred on or after the designated day, or was an injury partially attributable to a trauma that occurred before the designated day and partially attributable to a trauma that occurred on or after the designated day. Accordingly, it fell within the terms of clause 29(1)(b) or clause 29(2). Because the injury is a new injury, two immediate consequences follow. First, the RTW Act applies to it. Second, clause 37(6) does not apply to it.
[41]As the RTW Act applies to it, s 7(6) applies, but the application of s 7(6) to the surgical injury, while operating in its terms, only means that the injury resulting from the surgery is taken to constitute part of the original work injury. That original work injury occurred on 4 December 2014, i.e. before the designated day. That fact is not an impediment to the application of the RTW Act which commenced operation on the designated day because, pursuant to clause 29(3)(b), the RTW Act applies to a compensable injury under the repealed Act as if the RTW Act had been in operation before the compensable injury under the repealed Act occurred.
[42]As clause 37(6) does not apply to the respondent’s surgical injury, her entitlement to weekly payments is to be determined pursuant to s 39(3) of the RTW Act. This means she is eligible to receive weekly payments of up to 104 weeks from 4 December 2014, being the date when her incapacity first occurred as a result of the work injury of the same date. Accordingly, the respondent is entitled to weekly payments of income maintenance for the period 31 August 2015 until 21 September 2015.
[6] Return to Work Corporation of South Australia v Watkins [2017] SASCFC 149 at [40]-[42].
The Full Bench decision
The primary reasons for dismissing Mr Schroeder’s appeal on the issues the subject of the grounds of appeal were given by Hannon DPJ, with whom Dolphin PJ and Ardlie DPM agreed. The essential reasoning of Hannon DPJ is found in the following paragraphs:[7]
[49]I acknowledge that the facts in Watkins did not require consideration by the Supreme Court of whether a ‘new injury’ for the purposes of the Transitional Provisions would become the date of the original work injury under s 7(6) of the RTW Act, in circumstances where the period of incapacity with respect to which weekly payments were claimed fell after the two designated periods totalling 104 weeks from the date of the original work injury. Nevertheless, I am unable to discern any basis upon which the appellant can assert an entitlement to elect to claim payments on the basis that the original work injury be treated as an existing injury rather than as a new injury.
[50]On the facts of the case now before the Full Tribunal, it would seem to necessarily follow that, as the claim for weekly payments was made with respect to an injury which, however described by the appellant, was an injury partially attributable to a trauma that occurred before the designated day and partially attributable to a trauma that occurred on or after the designated day, it must be taken to be a new injury such that the RTW Act applies to it in the manner explained by Stanley J. It is an injury which provides for an entitlement to weekly payments which, by the operation of s 7(6) and s 39 of the RTW Act, is limited to a maximum period of 104 weeks from the date on which incapacity first occurs as a result of the original work injury, being the March 2012 injury. The further period of total incapacity following the March 2016 surgery falls after the expiry of the period of 104 weeks from the date on which incapacity for work first occurred after the original work injury, being a new injury for the purposes of the RTW Act. The conclusion must be that the intervening decision of the Supreme Court in Watkins confirmed that the Deputy President was correct to conclude that the entitlement period for weekly payments with respect to the new injury expired by 26 March 2014. For this reason, the decision below to dismiss each of the applications for review of the three disputed decisions must be upheld, and the appeal must be dismissed.
[7] Schroeder v Return to Work SA [2018] SAET 168 at [49]-[50].
As shall be seen, I reach the same conclusion for essentially the same reasons.
Discussion
Subclauses (1) and (2) of cl 29, read together, divide all cases in which there is an entitlement to compensation after the designated day into two subsets. The first subset, defined by cl 29(1)(a), comprises those workers with an existing injury attributable only to trauma which occurred before the designated day. The entitlement to weekly compensation of workers with an existing injury is governed by cl 37. If entitled to weekly payments before the designated day, workers in the first subset continue to be entitled to weekly payments in the event of subsequent incapacity for a further two years. To achieve that end, cl 37(3) of the Transitional Provisions expressly provides that a worker, other than one who is seriously injured, who is incapacitated by an existing injury has no entitlement to weekly payments after the second transitional period, and that it applies ‘instead of s 39(3) of this Act in relation to existing injuries’.
The second subset, defined by cl 29(1)(b) and cl 29(2), comprises workers suffering a new injury being one attributable, in whole or in part, to trauma which occurred after the designated day. In accordance with the decision of this Court in Watkins, they are entitled to weekly payments in accordance with the substantive provisions of the RTW Act, which includes the relation‑back requirement of s 7(6). Leaving aside for a moment Mr Schroeder’s proposed construction of cl 29(2) of the Transitional Provisions, the submissions on this appeal do not disclose any reason to doubt the correctness of this Court’s recent decision in Watkins. It has certainly not been shown to be plainly wrong. I would refuse permission to appeal on ground 1 insofar as it challenges the correctness of that decision.
It remains to deal with the construction of cl 29(2) of the Transitional Provisions which was not considered in Watkins. That construction gives cl 29(2), which, on its face, is a definitional provision, a substantive operation beyond the purpose of the Transitional Provisions. It does so by treating cl 29(2) as a deeming provision which enacts the counterfactual. Mr Schroeder’s submission is that, even though cl 29(2) expressly refers to injuries attributable to traumas occurring both before and after the designated day, it treats those injuries as occurring entirely on the day of the latter trauma. Clause 29(2) does not expressly so provide. It requires only that injuries in that category be taken to be a new injury ‘within the ambit of’, that is, included in, the definition of new injury in cl 29(1)(b).
A deeming operation should not generally be implied, precisely because the fiction it creates is contrary to the fact of a matter. Express deeming provisions are generally enacted in order to effect a particular policy purpose. As Stanley J observed in Watkins, as a matter of construction, deeming provisions are construed strictly, and applied only for the purpose apparent from their text and statutory context.[8] The rationale for that rule of construction also tells against drawing an implication that a provision, not expressly stated to be a deeming provision, has that effect. Courts do not construe legislation with a particular policy objective in mind and, for that reason too, will rarely imply a provision to deem a fact that is not shown by evidence to be a fact. Moreover, in this particular case, the implied deeming for which Mr Schroeder contends is inconsistent with the manifest purpose of s 7(6) of the RTW Act which is to prevent a creep, caused by the late provision of medical treatment, in the periods of entitlement to weekly payments provided by the RTW Act in both s 29 of the RTW Act and cl 37 of the Transitional Provisions.
[8] [2017] SASCFC 149 at [36].
The implication for which Mr Schroeder contends is also inconsistent with the expressly stated purpose of cl 29(1), which is to apply the RTW Act to both existing and new injuries. An injury which falls ‘within the ambit of subclause (1)(b)’ is necessarily an injury to which the RTW Act is intended to apply, yet on Mr Schroeder’s construction of cl 29(2) of the Transitional Provisions, s 7(6) of the RTW Act cannot have its intended, albeit fictional, operation, because it is precluded by a fiction which should be implied from cl 29(2). The prospect of duelling fictions is yet another reason not to accept Mr Schroeder’s construction.
Finally, Mr Schroeder’s construction leaves an inherent ambiguity. An injury may be attributable to multiple traumas occurring after the designated day. The implication for which he contends leaves unanswered the question whether the new injury is suffered on the day of the first, last, or some other of the post‑designated day traumas.
For all of the above reasons, I reject Mr Schroeder’s construction of cl 29(2) of the Transitional Provisions.
I turn to ground 2.
The RTW Act does not expressly allow for any election of the kind for which Mr Schroeder contends. Its provisions, not surprisingly, comprehensively deal with the substantive entitlements of workers with injuries attributable to traumas which occurred exclusively before or after, or both before and after, the designated day. It would be surprising if the legislature intended those substantive entitlements to be affected by the procedural choices of workers in how the claim is framed. There is no policy reason to do so in the single insurer model enacted by the RTW Act, and the Repealed Act before it. Indeed, rewarding different procedural devices with different substantive outcomes will result, eventually, in RTWSA always being called upon to pay the greater of the compensation alternatives, at least once the procedural device becomes common knowledge.
Be that as it may, the language of the Transitional Provisions is plain. Clause 37 applies only to existing injuries. Mr Schroeder has a new injury because it is attributable, at least in part, to the trauma of the surgery performed after the designated day.
It matters not that some symptoms may be due to Mr Schroeder’s existing injury alone. His injury, at least to his lower back, is attributable, on his own evidence, to both the trauma suffered on 27 March 2012 and to the trauma of the surgery.
The conclusion that, after the surgery was performed, Mr Schroeder had no entitlement pursuant to cl 37 for his existing injury leaves it unnecessary to decide whether or not cl 37(6) of the Transitional Provisions precluded his claim in any event because he had ceased to have any entitlement following his return to work.
Conclusion
I would refuse permission to appeal on ground 1 and dismiss the appeal.
STANLEY J: I agree with the orders proposed by the Chief Justice and with his reasons.
NICHOLSON J: I agree with the Chief Justice.
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