Shao Wen Zheng v Guo Yong Yang & Ors
[2008] NSWWCCPD 144
•9 December 2008
| WORKERS COMPENSATION COMMISSION | ||||||
| DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR | ||||||
| CITATION: | Shao Wen Zheng v Guo Yong Yang & Ors [2008] NSWWCCPD 144 | |||||
| APPELLANT: | Shao Wen Zheng | |||||
| FIRST RESPONDENT: | Guo Yong Yang | |||||
| SECOND RESPONDENT: | Workcover Authority of NSW | |||||
| THIRD RESPONDENTS: | Chan E Lu & Chi Kai Chung | |||||
| FILE NUMBER: | WCC A1 and A2 2974-08 | |||||
| DATE OF ARBITRATOR’S DECISION: | 4 August 2008 | |||||
| DATE OF APPEAL HEARING: | 26 November 2008 | |||||
| DATE OF APPEAL DECISION: | 9 December 2008 | |||||
| SUBJECT MATTER OF DECISION: | Procedural fairness; a party’s right to be heard on issues in dispute; whether work being performed under a contract of service; section 20 of the Workers Compensation Act 1987; failure to determine issues in dispute | |||||
| PRESIDENTIAL MEMBER: | Deputy President Bill Roche | |||||
| HEARING: | Oral | |||||
| REPRESENTATION: | Appellant: | Mr R Taylor, instructed by Keddies | ||||
| Second Respondent: | Mr A Baker, instructed by Sparke Helmore Lawyers | |||||
| ORDERS MADE ON APPEAL: | Paragraphs two and three of the Arbitrator’s determination of 4 August 2008 are revoked and the following findings and orders are made: “1. That the employer, Guo Yong Yang, was not insured as required by the Workers Compensation Act 1987 (‘the 1987 Act’) at the time of the applicant, Shao Wen Zheng’s, injury. 2. That the applicant, Shao Wen Zheng, has one child, Kai Yuan Zheng, born on 15 July 2003, totally or mainly dependent for support on him. 3. Award for the applicant, Shao Wen Zheng, against the first respondent, Guo Yong Yang, under section 36 of the 1987 Act in the sum of $600.00 per week from 4 July 2005 until 24 October 2005, and under section 37 at the statutory rate of compensation for a worker with one dependent child from 25 October 2005 to date and continuing. 4. The first respondent, Guo Yong Yang, is to pay the applicant, Shao Wen Zheng’s, reasonable hospital and medical expenses under section 60 of the 1987 Act. 5. That the WorkCover Authority of NSW, acting for the Nominal Insurer, pay to the applicant, Shao Wen Zheng, the compensation and costs awarded against Guo Yong Yang from the Workers Compensation Insurance Fund (‘the Fund’) established under section 154D of the 1987 Act. 6. That the employer, Guo Yong Yang, reimburse the WorkCover Authority of NSW, acting for the Nominal Insurer, for: (a) amounts paid out of the Fund in respect of compensation and costs awarded against the employer, and (b) the costs of the WorkCover Authority of NSW. 7. The matter be remitted to the Registrar for referral to an Approved Medical Specialist for assessment of Shao Wen Zheng’s whole person impairment as a result of the injury to his left upper limb on 25 April 2005. 8. Award in favour of the Third Respondents.” Paragraphs one, four and five of the Arbitrator’s determination of 4 August 2008 are confirmed. The parties are given leave to apply within seven days of the date of this decision, if any amendment to the above orders or any further or incidental order is required. | |||||
| The WorkCover Authority of NSW is to pay Shao Wen Zheng’s costs in appeal A1-2974/08 and in appeal A2-2974/08. | ||||||
INTRODUCTION
On 25 April 2005, the applicant (‘Mr Zheng’) lacerated his left arm while using an electric grinder to cut a timber skirting board at a house at 23 Berrille Road, Narwee. His claim turns on the resolution of two main issues. First, whether, at the time of the incident, he was a “worker” employed by the First Respondent (‘Mr Yang’), or was engaged in a personal or private activity or as an independent contractor (‘the employment/injury issue’).
Second, if Mr Zheng was employed by Mr Yang at the time of the injury, whether the owners of 23 Berrille Road (‘the Third Respondents’, Chan E Lu (‘Ms E Lu’) and Chi Kai Chung (‘Mrs Chung’)) are liable as principals under section 20 of the Workers Compensation Act of NSW 1987 (‘the 1987 Act’) (‘the section 20 principal issue’).
It is not disputed that Mr Yang was uninsured and, as a result, the Workcover Authority of NSW (‘WorkCover’) is the Second Respondent, acting for the Nominal Insurer under section 154C of the 1987 Act. Neither Mr Yang nor Ms E Lu or Mrs Chung has taken any part in the proceedings.
BACKGROUND
Mr Zheng was born in the Peoples Republic of China in January 1969 and came to Australia on 29 January 2005. Within days of arriving in Australia he met Mr Yang, a self-employed renovating contractor, who specialised in tile and timber floor replacement. Mr Yang offered Mr Zheng employment with him tiling a block of units in Canberra. Mr Zheng accepted that offer and travelled to Canberra with Mr Yang on the day they met. After working with Mr Yang in Canberra for about one month, Mr Zheng returned to Sydney in March 2005 and commenced casual work at a furniture factory at Granville where he worked for about two weeks. Later in March he worked for several days at a furniture factory at Arncliffe.
In or about the second week of April 2005, Mr Yang asked Mr Zheng if he would return to work for him on a job replacing flooring at a home at 23 Berrille Road, Narwee (‘23 Berrille Road’) the residential property owned by Ms E Lu and Mrs Chung. The job required the carpet to be removed and new timber floorboards to be laid. To do that work the skirting boards had to be removed and replaced.
On 25 April 2005, Mr Zheng started work with Mr Yang at Berrille Road at about 8am. They worked together until 10am when Mr Yang left the site to purchase some nails. Mr Zheng then used an electric grinder to cut a skirting board for it to be refitted in a room where the new timber flooring had already been layed. While cutting the timber, the grinder allegedly slipped forward and struck Mr Zheng’s left wrist causing a severe laceration.
Whilst an ambulance was called, Mr Zheng did not wait for its arrival and a neighbour drove him to St George Hospital. On the way to the hospital they passed the arriving ambulance and Mr Zheng was transferred to that ambulance and completed the journey to the hospital in the ambulance. At hospital he under went emergency surgery on his left wrist and he was discharged on 27 April 2005.
On 4 August 2005, Mr Zheng made a claim, through his solicitor, Keddies, on the uninsured liability and indemnity scheme. In response to that claim, Workcover wrote to Keddies on 8 August 2005 seeking certain documentation. In addition, Workcover instructed investigators, Maurice J Kerrigan and Associates (‘Kerrigan’s’) to investigate the claim. By letter dated 15 March 2006, Workcover declined Mr Zheng’s claim on the basis that it had been “unable to substantiate an employer/employee relationship between” Mr Zheng and the alleged employer.
After an earlier Application to Resolve a Dispute was filed and then discontinued in 2007, the current Application was registered in the Commission on 22 April 2008. Mr Zheng alleges that he sustained an injury to his left wrist, scarring, shock and psychological sequelae as a result of his injury on 25 April 2005 whilst working for Mr Yang. He claims weekly compensation for himself and his dependent son (Kai Yuan Zheng, born on 15 July 2003) from 3 July 2005 to date and continuing in the sum of $900 per week. In addition he claims lump sum compensation in respect of a 53% whole person impairment together with compensation for pain and suffering, and hospital and medical expenses.
The claim dates from July 2005 because Mr Zheng has already received compensation up to 3 July 2005 pursuant to an Interim Payment Direction made by a delegate of the Registrar of the Workers Compensation Commission on 5 April 2006.
By a notice under section 74 of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’), Workcover disputed the claim on the following grounds:
(a)that Mr Zheng was not an employee of Mr Yang on 25 April 2005 and, accordingly, was not a worker within the meaning of section 4 of the 1998 Act and therefore not entitled to compensation;
(b)that Mr Zheng did not suffer an injury or incapacity as a result of any compensable injury;
(c)that Mr Zheng was not entitled to make a claim under “Part 4 – Uninsured Liabilities” of the 1987 Act, as he was entitled to claim compensation against a principle under section 20 of the 1987 Act, and
(d)that Mr Zheng suffered no whole person impairment as alleged or at all as a result of any compensable injury.
The notice did not dispute the dependency of Mr Zheng’s child and WorkCover made no application at the arbitration, or on appeal, for leave under section 289A(4) of the 1998 Act to dispute that part of the claim.
The section 74 notice referred to the following evidence and assertions in support of its contention that Mr Zheng was not an employee:
(a)clinical notes from St George Hospital dated 25 April 2005, which referred to Mr Zheng being “unemployed”;
(b)a statutory declaration from Mr Zheng attached to his income tax return for the financial year ending 30 June 2005, which recorded that he had been employed by Mr Yang from “29 January 2005 to 24 April 2005”;
(c)records produced by the Department of Immigration and Multicultural Affairs, which recorded Mr Zheng’s residence as 23 Berrille Road, Narwee, NSW 2209;
(d)records from St George Hospital which recorded Mr Zeng’s place of residence as 23 Berrille Road, Narwee;
(e)it was more probable that the work being performed on 25 April 2005 was unrelated to employment duties;
(f)the decision of the Australian Government Refugee Tribunal handed down on 4 October 2005 found that Mr Zheng was “reticent and vague”;
(g)the statement from the alleged witness, Mr Biao Li (‘Mr Li’, referred to as ‘Mr Lee’ in the transcript), of 14 November 2005 was inconsistent with his later statement of 26 April 2006;
(h)Mr Zheng had not provided any documentary evidence of a contract of employment or any documentary evidence that he was paid wages, such as payslips or group certificates;
(i)Mr Zheng failed to provide any independent documentary evidence as to the rate of pay allegedly made to him by Mr Yang, and
(j)Professor Cumming assessed Mr Zheng to have 31% whole person impairment.
Workcover filed a reply to the current application on 12 May 2008 attaching a copy of the section 74 notice together with other documents.
The matter was listed for conciliation and arbitration on 30 June 2008. Mr Taylor, of counsel, appeared for Mr Zheng and Mr Baker, of counsel, appeared for WorkCover. The matter proceeded on that day with submissions from counsel, but no oral evidence. The matter could not be completed and was adjourned until 30 July 2008 (incorrectly noted as 31 July 2008 in the transcript) when submissions resumed.
On 30 July 2008, the Arbitrator interrupted Mr Baker’s submissions and indicated that he wished to deal with the “section 20 principal issue” (T127.46). He then heard submissions on that issue and delivered an ex tempore decision dealing with the section 20 principal issue and with the issue of employment (T133.22). He declined Mr Taylor’s application that he also determine the issues of injury and incapacity. The Commission issued the Arbitrator’s formal determination in a Certificate of Determination on 4 August 2008. It sets out the Arbitrator’s formal orders as follows:
“The determination of the Commission in this matter is as follows:
1. I find that the Applicant was an employee of the First Respondent on 25 April 2005;
2. I find that the First Respondent was employed as a contractor by the Third Respondent;
3. I find that the Third Respondent is liable as a principal pursuant to s20 of the Workers Compensation Act 1987, to pay any compensation which as principal it would have been liable to pay if the applicant had been immediately employed by the principal on 25 April 2005;
4. The Second Respondent is to pay the Applicant’s costs as agreed or assessed;
5. I certify that this was a complex matter and determine that pursuant to Clause 4 of Schedule 6 of Item 4 of Table 4 of the Workers Compensation Regulation 2003 that in respect of both the Applicant’s and Second Respondent’s costs that a percentage increase of 35% be applied. The determination of the matters in dispute required more than one day of arbitration and each day is to be regarded as a separate event for the purposes of the cost regulations.”
By an appeal filed on 26 August 2008, Workcover seeks leave to appeal against the Arbitrator’s determination on the following grounds:
(a)the Arbitrator failed to provide any adequate reasons for his determination, and
(b)the Arbitrator denied procedural fairness to Workcover by not committing its counsel to complete submissions on critical issues of liability.
By an appeal filed on 1 September 2008, Mr Zheng seeks leave to appeal against the Arbitrator’s determination on the grounds that he erred in:
(a)finding that Mr Yang was employed as a contractor of Ms E Lu and Mrs Chung;
(b)finding that Ms E Lu and Mrs Chung were liable as principals pursuant to section 20 of the 1987 Act;
(c)failing to make a determination as to injury and incapacity, and
(d)terminating the hearing to ensure that the alleged section 20 principal was joined to the proceedings and that any further matters dealing with the alleged section 20 principal should be brought by way of fresh proceedings.
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.
It is not disputed that the monetary thresholds in section 352(2) of the 1998 Act are satisfied.
Time
Both appeals were lodged within 28 days of the Arbitrator’s determination in compliance with section 352(4) of the 1998 Act.
I grant leave to appeal in both appeals.
PRELIMINARY MATTERS
Conduct of the Arbitration
In view of the lengthy and unsatisfactory history of this matter, and the complex issues involved, the appeals were listed for oral hearing before me on 26 November 2008. As before the Arbitrator, the parties were represented by counsel, Mr Baker again appearing for Workcover and Mr Taylor again appearing for Mr Zheng. At the invitation of the parties, I indicated my preliminary view was that the appeal by Workcover had strong prospects of success, as it appeared that it had been denied procedural fairness because the Arbitrator did not give Mr Baker the opportunity to make submissions on issues in dispute. I now formally give my reasons in respect of the appeals and why this matter must be re-determined.
After stopping Mr Baker partway through his submissions on the employment issue, the Arbitrator indicated that he wished to address the section 20 principal issue (T129.4) and he invited submissions on that issue. After hearing those submissions, the Arbitrator determined the section 20 issue (accepting Mr Baker’s submission that there was a section 20 principal) and, without allowing Mr Baker to complete his submissions on the employment issue, he determined that issue in favour of Mr Zheng.
While proceedings in the Commission are less formal than in a court and the Commission is required to conduct its matters with “as little formality and technicality as the proper consideration of the matter permits” (section 354(1) of the 1998 Act), Arbitrators and Deputy Presidents are required to comply with the rules of natural justice and procedural fairness (South Western Sydney Area Health Service v Edmonds [2007] NSWCA 16 at [91]). In the present matter, fairness in all the circumstances required that each party be given a reasonable opportunity to be heard (per Kirby J in Allesch v Maunz (2000) 203 CLR 172 at 185). That opportunity was denied to WorkCover and its appeal must therefore succeed.
In respect of Mr Zheng’s appeal, the Arbitrator failed to determine the issues of injury or incapacity, though those issues were in dispute, were properly before him and he was expressly invited to do so (T139.12). A failure to determine disputed issues on the basis of the facts and arguments presented at arbitration constitutes an error (see Najdovski v Crnojlovic [2008] NSWCA 175 at [21]). Therefore, Mr Zheng’s appeal must also succeed. Mr Zheng’s arguments in respect of the section 20 issue are dealt with below, at [75] to [84].
In view of the history of this matter and as no oral evidence was heard, it is appropriate that I re-determine all issues in dispute. Both parties consented to that course.
Additional Evidence
In the course of hearing the redetermination, both parties sought to adduce additional evidence. Mr Baker sought to tender the following documents;
(a)a letter from Sparke Helmore to Keddies dated 3 April 2008, purporting to serve the section 74 notice together with a report from Dr Akkerman dated 11 March 2008;
(b)a letter from Sparke Helmore to Keddies dated 1 July 2008 noting that at the arbitration hearing on 30 June 2008 Mr Taylor indicated that he had not seen a copy of Dr Akkerman’s report and enclosing a copy of the letter of 3 April 2008. The letter also requested advice if a “further copy” of Dr Akkerman’s report was required, and
(c)a report from Dr Akkerman, psychiatrist, dated 11 March 2008.
Mr Taylor objected to the tender of the above documents arguing that his client was prejudiced as he had not seen Dr Akkerman’s report until 30 July 2008 and, as a result, he had been deprived of the opportunity of having his psychiatrist, Dr Westmore, comment on it.
Mr Zheng sought to rely on the following additional evidence:
(a)an application to admit late documents dated 29 July 2008 with the following attachments;
(i)an invoice from City Allied Health Centre, and
(ii)a document headed Further Statement from Mr Zheng, dated 29 July 2008, and
(b)a further statement from Mr Li, dated 1 August 2008.
Workcover objected to these documents, but identified no prejudice it would suffer and did not seek to cross examine either Mr Li or Mr Zheng on their further statements.
The parties are reminded, as they were at the hearing, that additional evidence will only be admitted on appeal in exceptional circumstances and that arbitrations are not a ‘practice run’. All relevant evidence must normally be called at the arbitration. The admission of additional evidence on appeal is only permitted by leave in exceptional circumstances. The unsatisfactory history of this matter, the complexity of the factual issues involved, the length of time since Mr Zheng’s injury, the fact that the additional evidence would be admissible if the matter were remitted for a further arbitration, the absence of any identifiable prejudice to either side, and the terms of section 354(3) of the 1998 Act, all strongly favour the admission of all the documents both sides seek to tender on appeal for the purpose of the present re-determination. For these reasons, I admit into evidence on the re-determination the additional evidence from both sides.
THE EVIDENCE
Lay Evidence
Mr Zheng’s evidence is set out in statements dated 15 June 2007, 22 August 2007, 29 October 2007, 19 March 2008, 17 April 2008 and 29 July 2008. The main points in his statement of 15 June 2007 are:
(a)he was born in the Peoples Republic of China in January 1969 and completed his high school education in 1986. From 1987 until 1990 he was in the Chinese army and between 1990 and 2004 he worked as a truck driver for various employers in China;
(b)in January 2005 he divorced his wife, who remains in China with their son;
(c)on 29 January 2005 he immigrated to Australia on a business visa which entitled him to work in Australia on an unrestricted basis;
(d)in January 2005, he met Mr Yang, a person who described himself as a self employed renovating contractor who specialised in tile and timber floor replacements, who offered him employment on a job in Canberra where he was tiling a large block of units. Mr Zheng accepted that offer and says he was to be paid $60 per day. He had no prior experience with power tools or how to use them. All such tools were supplied by Mr Yang;
(e)after three days at work Mr Yang increased his pay to $80 per day and, later, increased it to $120 per day;
(f)Mr Zheng worked in Canberra for Mr Yang for about four weeks and then returned to Sydney in March 2005 where he worked in a furniture factory at Granville for approximately two weeks and then for three or four days at a furniture factory in Arncliffe;
(g)in or about the second week of April 2005, Mr Yang requested Mr Zheng to return to work with him. At that time Mr Zheng was living with Mr Yang at 86 Mercury Street, Narwee. Mr Yang was paying Mr Zheng’s rent of approximately $60 per week;
(h)the next job with Mr Yang was a job that required the removal of carpet and the laying of new timber floor boards over existing timber floor boards at 23 Berrille Road, Narwee. To do that work skirting boards had to be removed and replaced;
(i)Mr Yang supplied all tools and equipment for the job and instructed Mr Zheng what to do. Mr Zheng worked six days per week, 7.30am until 7.30pm and earned $750 per week;
(j)on 25 April 2005, Mr Zheng commenced work with Mr Yang at Berrille Road at 8am. At about 10am, Mr Yang left the site to purchase some nails. Prior to leaving, Mr Yang directed Mr Zheng to cut the skirting board and refit it in a room where the flooring had already been replaced;
(k)Mr Zheng says he was directed to use an electric grinder to cut the skirting board and that he was in the process of performing that task when the grinder slipped forward and hit his left wrist causing a severe laceration;
(l)someone rang for an ambulance but, as Mr Zheng was bleeding profusely, a neighbour started to drive him to St George Hospital. On the way to the hospital Mr Zheng was transferred into an ambulance and he completed the journey to hospital in that ambulance;
(m)he was admitted to St George Hospital where he underwent surgery on his left wrist and was discharged on 30 April 2005 when he returned to live at 86 Mercury Street, Narwee where he stayed for about two weeks and then moved to “Mr Yang’s girlfriend’s place for about one-and-a half-months”;
(n)on 18 June 2005, Mr Zheng moved to 54B Grove Avenue, Narwee where he rented a room with four other residents;
(o)prior to his accident, Mr Zheng received a payment of $500 from Mr Yang in respect of work he had performed and a further $1,000 was transferred into his bank account after the accident. These payments were for the two weeks work done prior to his accident on 25 April 2005. Apart from $100 that he used for expenses, he deposited these amounts into his bank account;
(p)following the accident, Mr Yang would visit him every day for about one-and-a-half months until he moved to 54B Grove Avenue Narwee;
(q)he is extremely depressed, moody and angry;
(r)his left arm is always painful and he has to wear a support on it at all times. He is unable to move his left hand and is very restricted in his ability to move his fingers and is unable to form a fist. He has lost all feeling in his left hand, and
(s)he attended the Hand Clinic at St George Hospital on a weekly basis for therapy, but had to stop that treatment in March 2006 as he was unable to afford it as he had no money and “could not afford to pay for a ticket to travel for the treatment”.
Mr Zheng added, in his statement of 22 August 2007;
(a)he was introduced to Mr Yang by a friend of his sister’s husband at the end of January or beginning of February 2005. He started working for Mr Yang around 1 February 2005. Mr Yang asked if he had done any “gyprock work before” to which Mr Zheng replied, “no”. Mr Yang gave him a two-day trial and taught him how to use tools and identify materials. On the afternoon of the second day Mr Zheng did about five square metres of tiling. Mr Yang was happy with his work and wanted him to continue and agreed to pay him $80 per day;
(b)there was “another partner working with Mr Yang whose name was Mr Liu”. Mr Zheng alleges that Mr Liu was an illegal immigrant and Mr Yang reported him to the authorities. At that time, Mr Yang said “he had to stop the project for a period of time” so that Mr Zheng had to find work elsewhere. It was then that Mr Zheng returned to Sydney and worked in two different furniture factories, one at Granville and one at Arncliffe;
(c)when everything had “settled down”, Mr Zheng started working for Mr Yang again;
(d)Mr Yang had full control over the hours worked;
(e)the agreement with Mr Yang was that Mr Zheng would be paid $120 per day for labouring work and be paid extra if he worked more than nine hours per day. Mr Zheng normally worked between six and seven days per week and, most of the time, did “extra hours” so was usually paid between $130 and $150 per day;
(f)he was required to start work at 9am every day and usually finished at 6pm, but a lot of the time he worked later and did overtime for one to two hours. He usually worked his “normal 9 hours, plus normally an extra two hours of overtime a day”;
(g)Mr Zheng was usually paid in cash and it was his understanding that Mr Yang deducted tax. He added, “at this time I will just hold on to my cash as I did not have a bank account. I was saving my money so I could send it to China for my son”;
(h)when he applied for a truck driver’s licence in Australia he was told he needed to have a bank account. He opened a bank account with the assistance of Mr Yang and Mr Yang’s girlfriend (Ms E Lu’s sister, Lu Chan Lian (‘Ms L Lu’) on or about 6 April 2005 and deposited some of his wages into that account;
(i)when he initially came to Australia, it was Mr Zheng’s intention to find work as a truck driver and he saw his position with Mr Yang as a “fill in short term job” and not something he intended to do on a full-time basis. Once he improved his English language skills and obtained a truck driver’s licence, he intended seeking work in that field in Australia;
(j)prior to his accident on 25 April 2005, Mr Zheng attended a church run English school to improve his English;
(k)after his accident, Mr Yang arranged for him to move into Mr Yang’s girlfriend’s place for about one-and-a-half months and he would continue to come and visit him, and
(l)Mr Zheng deposited $400 of his wages into his St George bank account and used the remaining money for expenses. On the day after his accident (26 April 2005), Mr Yang deposited a further $1,000 into Mr Zheng’s bank account for the two weeks work he had done prior to the accident.
In his statement of 29 October 2007, Mr Zheng added:
(a)upon his arrival in Australia he “was applying for a Protection Visa”. At that stage, he did not have a permanent address and Mr Yang told him to use the address of 23 Birrille Road, Narwee. Mr Yang said that that address was his girlfriend’s sister’s home, which she and her mother rented out to people, and
(b)it was difficult to obtain a visa to leave China and his immigration agent explained to him that “certain things needed to be put into the application and he [the agent] would complete the form for me as he knew what information needed to be included”.
Mr Zheng added in his statement of 19 March 2008:
(a)at the time he applied for a visa for Australia, it was his hope and expectation that he would be able to work in Australia as a truck driver and that is what he told his agent when he applied for the visa. He does not know what was put in the visa application by his agent, as he does not read English;
(b)details of his involvement with Falun Gong in China;
(c)in respect of his work at the furniture factories in Granville and Arncliffe, Mr Zheng found both jobs through advertisements in newspapers and he worked for about two weeks at one factory and about one week or less at the other factory;
(d)while working at the factory at Arncliffe, he received a phone call from Mr Yang telling him that he had some work starting the following week. He started working again for Mr Yang in either the first or second week of April 2005. He believes he had been working for Mr Yang at 23 Berrille Road for at least two weeks prior to his accident on 25 April 2005. His recollection is that he and Mr Yang “removed and replaced floor boards, skirting boards and floor boards supports in about five rooms” and that it was a large and time consuming job;
(e)though he does not have much pain in his left hand, it is constantly numb and that disturbs him at night. He does not sleep well and is constantly tired and depressed about his situation;
(f)his wife divorced him about five months after his injury;
(g)after his accident, he had some physiotherapy at St George Hospital and saw doctors at that hospital occasionally. He could not continue that treatment because he “was asked to pay for it” and could not afford to do so;
(h)while working at 23 Berrille Road, he worked six to seven days per week. He normally worked about “nine hours per day” and for those nine hours he expected to be paid $120. However, he worked extra hours and when he did he was paid more than $120 per day. On occasions, he was paid up to $140 to $150 per day;
(i)he did not know if his boss was deducting tax or not, but he thought the payments he received were after tax payments, and
(j)Mr Yang always told him what to do and when and where to do it.
Mr Zheng’s statement of 17 April 2008 deals with the clinical notes from St George Hospital that record he was unemployed and that his place of residence was 23 Berrile Road, Narwee. Mr Zheng denies telling any doctor or staff member at the hospital that he was unemployed or that he lived at 23 Berrille Road. He had very little to no English skills at that time and he was “unable to communicate with the hospital staff”. He added that the hospital notes disclosed that Ms L Lu, of 23 Berrille Road, Narwee, was the person nominated as the “person for notification” and that Ms L Lu was Mr Yang’s girlfriend. He assumes that it was Ms L Lu who gave the incorrect information to the hospital staff.
In his statement of 29 July 2008, Mr Zheng made the following additional points:
(a)all of the information contained in his statement of 15 June 2007 was “initially provided” on 27 July 2005. However, he did not sign his statement until 15 June 2007, when his matter was being prepared for referral to the Workers Compensation Commission;
(b)the only people who visited him at St George Hospital were Mr Yang and Ms L Lu. They visited him every day he was in hospital and Ms L Lu helped him fill in the menu for his meals, completed other forms for him and also communicated with hospital staff on his behalf. He does not know what she said to the hospital staff;
(c)on returning from Canberra, Mr Zheng obtained a job at a furniture factory in Granville and accommodation at Granville. He then moved to Campsie and was contacted by Mr Yang who asked him to return to work for him. He then moved into a room at 86 Mercury Street, Narwee, as arranged by Mr Yang. Mr Yang leased the room for him and paid his rent, which was deducted from his wage. Mr Yang did not live at 86 Mercury Street, Narwee, but lived with his girlfriend and “at that time they were living at 23 Berrille Road Narwee”;
(d)after being discharged from hospital, he returned to live at 86 Mercury Street, Narwee for about two weeks and the reference to “23” at paragraph 45 of his statement of 15 June 2007 is a typing mistake and should read “86”;
(e)Mr Zheng then moved into Ms L Lu’s “place [at] 10 Elston Avenue, Narwee” where he lived for approximately one-and-a-half months. Three other people lived at that house, Steven Lin, Ms Ran Lou and Mrs Sun. On or about 18 June 2005, Mr Zheng moved to 54B Grove Avenue, Narwee where he rented a room with four other residents;
(f)at the time he provided the information set out in his statement of 15 June 2007, that is, on 27 July 2005, Mr Zheng attended the St George Hospital Hand Clinic weekly. He stopped attending because he could not afford the travelling expenses. He added that he was unable to go anywhere by himself because of his limited English and, therefore, was restricted to going for consultations when Steven Lin, a housemate at 54B Grove Avenue, Narwee, was available to accompany him. He twice attended the Hand Clinic without Mr Lin and, as he was unable to communicate, the consultations were of no benefit. He did not feel that he was getting any benefit from his visits to the Hand Clinic;
(g)between May 2007 and September 2007 he received physiotherapy treatment from City Allied Health Centre, which has Chinese speaking physiotherapists who provided him with treatment on credit for a period of four months. After that period he was required to pay, but could not afford to do so and the treatment stopped;
(h)Mr Zheng did not see Dr Vago between 20 September 2006 and 16 April 2007 because the doctor relocated his surgery and Mr Zheng was not aware of the location of the new surgery. In April 2007, Mr Steve Zheng, a clerk or solicitor at Keddies, located Dr Vago’s surgery at the Marrickville Metro Medical Centre and Mr Zheng recommenced attendances on the doctor;
(i)in respect of his divorce, he separated from his wife in January 2005, but his divorce was not finalised until about five months after his accident, and
(j)he did not live with Mr Yang at 86 Mercury Street, Narwee. Mr Yang leased the room for Mr Zheng and paid the rent, but he was living with Ms L Lu, his girlfriend.
In support of his claim Mr Zheng relies on statements from several witnesses. The first is Mr Li, who has provided four statements. His first statement is dated 14 November 2005 and was provided to Workcover’s investigator, Mr G Bransgrove. His other statements are dated 26 April 2006 (possibly prepared on 6 July 2005), 13 June 2006 and 1 August 2008. The key points made by Mr Li in his November 2005 statement are:
(a)he lived at 23 Berrille Road, Narwee for three or four months, renting the property from “an old lady and her daughter”. He paid rent to “the old lady that lived there”, but he did not know her name;
(b)on the day of the injury, Mr Li was present at 23 Berrille Road. Mr Zheng rushed out of a small room and said he had been using a grinder to cut a piece of timber. A neighbour took Mr Zheng to hospital;
(c)after the neighbour left with Mr Zheng, Mr Li saw a grinder, a piece of timber and blood in the room where Mr Zheng had been working;
(d)the room in which Mr Zheng had been working “was a room for renting, and it was a tenant’s room. The tenant who was renting this room was a male but I do not know his name”;
(e)other people were present at 23 Berrille Road when the accident occurred but they were “all in the living room eating something”;
(f)he did not know who asked Mr Yang to come to the house to do the work, but the work took a few weeks to one month or more. Mr Yang “painted and he did the floors”;
(g)Mr Li did not know who paid Mr Yang for the work;
(h)Mr Zheng lived at 23 Berrill Road, Narwee for one week after he was released from hospital. While he was living there, Mr Zheng said that the job he was doing was supposed to be done by two people, but Mr Zheng had been there working by himself;
(i)Mr Zheng “did not actually tell me anything about his employment with Mr Yang”;
(j)Mr Li saw Mr Zheng and Mr Yang working between “about 6.30 and 9pm”. He was not sure how often Mr Yang worked there, as he would go to his room when he arrived home, but he saw both Mr Yang and Mr Zheng working;
(k)on occasions he saw Mr Yang telling Mr Zheng to do things, and
(l)based on his observations, Mr Li formed the opinion that Mr Yang “was the employer and Mr Zheng was the employee”.
Mr Li completed this statement at Keddies’ offices in Goulburn Street, Sydney in the presence of the Workcover investigator, a translator and Mr Zheng’s solicitor. He had the opportunity of reading the statement and both he and the interpreter declared that the contents were true and correct. The interpreter, Aaron Yuan Yu, signed a declaration stating that the contents of the statement were true and correct and that he believed that Mr Li understood all the questions that were asked of him.
In his statement of 26 April 2006 (signed on 26 April 2006, but with a typed date of 6 July 2005 on the top of page one), Mr Li made the following points:
(a)he met Mr Zheng when he (Mr Zheng) came to 23 Berrille Road to work with Mr Yang. Mr Yang and Mr Zheng replaced the whole floor of the house;
(b)he started work at 6.30am as a renovator. When he got home at about 6.30pm, he would see Mr Zheng and Mr Yang working. Sometimes they worked until “very late”;
(c)he heard Mr Yang instructing Mr Zheng what to do, such as cutting and carrying timber, and Mr Zheng appeared to do as he was instructed;
(d)his impression was that the tools and equipment belonged to Mr Yang;
(e)at the time of the accident, Mr Li was in the dinning room when he heard Mr Zheng say “help me”;
(f)Mr Yang finished the job, “this was my room”;
(g)Mr Li never saw Mr Yang pay Mr Zheng any money, and
(h)he assumed that Mr Yang was Mr Zheng’s boss as he would bring him to work and instruct him what to do.
Nora Wu (presumably from Keddies) read the statement of April 2006 to Mr Li and he confirmed its accuracy.
Mr Li’s next statement is dated 13 June 2006. As this statement is of some significance and is fairly brief, it can be set out in full:
“1. My name is Biao Li;
2.This statement is to be read in conjunction with my previous statement signed on 26 April 2006;
3.Mr Yang employed Mr Zheng to work with him, assisting him to repair the house in which I live at 23 Berrille Road, Narwee.
4.I don’t know if there was any written agreement between Mr Yang and Mr Zheng but I do know that Mr Yang paid Mr Zheng for the work he did for Mr Yang.
5.In speaking to Mr Zheng prior to his accident Mr Zheng told me that Mr Yang paid him $120 per day in cash.
6. I have witnessed Mr Yang pay Mr Zheng cash money previously.
7. I have spoken to Mr Yang regarding Mr Zheng and he did confirm that he paid Mr Zheng $120 per day for working with him.
8. Mr Yang also allowed Mr Zheng to stay in Mr Yang’s girlfriends [sic] house at Elston Avenue, Narwee as payment for his work.”
Mr Li’s last statement is dated 1 August 2008. He makes the following points:
(a)he arrived in Australia on 19 March 2005 and moved into 23 Berrille Road, Narwee where he lived for three to four months;
(b)he did not know the exact name of the room he was in at the time of Mr Zheng’s accident, whether it was a dining room or a living room but it was a room attached to the kitchen;
(c)the room in which Mr Zheng was working when he was injured, was a room occupied by one of the other male tenants. At the time of the accident two rooms remained to be completed, the room where the accident occurred and Mr Li’s room. After the accident, Mr Yang finished the job, including Mr Li’s room;
(d)after being released from hospital Mr Zheng moved into a room in 23 Berrille Road, Narwee for approximately one week. He moved into a room usually occupied by Mr Yang’s girlfriend, but she vacated to allow him to stay there;
(e)after the accident Mr Li asked Mr Zheng what happened and how he was and “Mr Yang [sic] said to me words to the effect; ‘don’t ask about things. It is none of your business. You make any noise and you will have to move out’”;
(f)he agreed that in his first statement he said that he had not seen Mr Yang pay any money to Mr Zheng, as he did not want to get himself into trouble with Mr Yang;
(g)he confirmed that prior to Mr Zheng’s accident he had seen Mr Yang pay money to Mr Zheng and that he had spoken to Mr Yang who confirmed that he was paying Mr Zheng $120 per day for working for him. This information came about in a conversation one evening at 23 Berrille Road when Mr Li asked if he could work for Mr Yang and Mr Yang replied, “for a worker like Zheng I pay $120 per day, but for a more experienced worker, I would pay up to $200 per day. So if you can prove you have the experience I would pay you $200 per day.” Mr Yang added that when he had another job or project he would tell Mr Li so he could try and if his work was good enough he would employ him;
(h)he did not include his knowledge about Mr Yang paying Mr Zheng until his June 2006 statement as he was “previously scared of being kicked out of my room and I was also hopeful of getting a well paid job with Mr Yang”. In addition, Mr Yang had threatened him and told him that he talked too much and should not get into other people’s business and not to talk to Mr Zheng.
Mr Zheng relies on a statement from Steven Lin dated 4 March 2006. His statement can be summarised as follows:
(a)he lived in a rented room at 10 Elston Avenue Narwee, a room he had occupied since about January 2005;
(b)he first met Mr Zheng when he moved into a room at Elston Avenue in early May 2005;
(c)Mr Zheng said to him “I was working for Mr Yang. I was at Mrs Lu’s house. I was doing the floor and cut my arm with a grinder. I had been using the grinder to cut the wood”;
(d)Mr Yang would visit Mr Zheng every day for a few weeks and would bring some food;
(e)about two weeks after Mr Zheng moved in, Mr Yang moved in and stayed with us until October 2005, and
(f)sometimes “Mr Lu” (presumably this should be Ms L Lu) would come and spend the night in Mr Yang’s room.
The next witness statement Mr Zheng relies on is from Ms Run Lou, Mr Lin’s girlfriend, dated 4 March 2006. She also moved into 10 Elston Avenue Narwee in or about January 2005. She confirms that Mr Zheng also lived in the house sometime after he injured his arm. At some stage Mr Zheng told Ms Lou he had been working for Mr Yang and was injured in Mrs Lu’s house.
Medical and Expert Evidence
Mr Zheng was admitted to St George Hospital on 25 April 2005. The “Administration Summary” records, among other things;
“circular saw injury;
R handed, MSB, unemployed
nil sensation, weak radial pulse”
The clinical notes for 25 April 2005 also record the following:
“J Taufik [sic] (ortho)
36 [male]
RHD
NESB
unemployed
circular saw injury L forearm”
Mr Zheng was discharged from hospital on 27 April 2005 (not 30 April 2005, as claimed in his evidence).
The first medical certificate in evidence is a Workcover medical certificate from the St George Hospital Hand Clinic dated 9 May 2005. It records Mr Zheng’s occupation as “floor layer” and describes his injury as occurring as follows: “using grinder to trim floor boards”. It describes Mr Zheng’s employer as “Guo Yong Yang” of 86 Mercury Street, Narwee.
Mr Zheng came under the care of Dr Vago, general practitioner, on 20 June 2005 and produced certificates from that doctor for the period from June 2005 until 20 September 2006 and then from May 2007 until 2008. Mr Zheng did not see Dr Vago between September 2006 and April 2007 and the explanation for that is found in his statement referred to at paragraph [38(h)] above. In his report of 18 February 2008, Dr Vago took a history that he first saw Mr Zheng on 20 June 2005 when he took the following history:
“Mr Zhen [sic] stated that he suffered injuries whilst at work on Monday 25 April ’07 [sic] at approximately 12.00 mid-day. Apparently he was employed at [sic] Guo Yong Yang, laying timber flooring at the time, when whilst cutting timber cut his left forearm in the process. He cut the nerves in the left forearm as well as arteries with a circular saw. He was taken to St George Hospital, Kogarah where he under went surgery. Today he had limited movements [sic] of the left fingers.
Dr Vago recorded Mr Zheng’s complaints of continuing pain and weakness involving the “left hand fingers” and a complaint of on-going numbness in the left hand. Mr Zheng also complained of difficulty using his left hand and an inability to grip with that hand. He also recorded that Mr Zheng is right hand dominant. On examination he noted scarring over the left forearm and paraesthesia adjacent to the scar. Finger movements were reduced in range and there was associated swelling in the left hand. He also referred to the operation report from St George Hospital, which recorded that the median, radial and ulnar nerves were completely severed “with very jagged edges”. The flexor pollicis longus was partially (50%) lacerated and the flexor carpi radialis and the flexor carpi ulnaris muscles were completely lacerated. The flexor digitorum profundus was partially lacerated and the flexor digitorum superficialis was completely lacerated.
Dr Vago considered Mr Zheng’s employability in the open labour market “in particular in the industry he was employed in is nil” and that he would not be suited for truck driving “as it would be unsafe for him to drive trucks with his limited use of [his] left hand and forearm”.
Dr Bodel, orthopaedic surgeon, examined Mr Zheng for medico-legal purposes on 15 November 2006. In his report of the same date, the doctor noted that Mr Zheng worked “in carpentry activities for a Mr Yang” and that he had been with Mr Yang for “about a month prior to his injury” on 25 April 2005. In respect of the injury, Dr Bodel recorded that Mr Zheng was using a small angle grinder to “cut out a section of a wooden skirting board”. Dr Bodel noted that Mr Zheng under went extensive hand therapy, but recovery of the sensory loss had been very poor.
On examination, Dr Bodel noted a grossly restricted range wrist flexion and extension although there was good radial and ulnar deviation. There was no restriction of forearm pronation or supination, but active movement in all four fingers and the thumb was grossly restricted. There was numbness in the radial, median and ulnar nerve distributions.
Under “Current and Proposed Treatment”, Dr Bodel recorded that he found it very difficult to understand Mr Zheng, even with the assistance of an interpreter. Dr Bodel concluded that Mr Zheng has had a poor recovery of function from a serious injury to his left forearm. He had some movement of the fingers and thumb, but had no recovery of sensory function in his hand. It was unlikely that further surgical treatment would help, though it was appropriate for him to remain under the care of a specialist hand surgeon. Dr Bodel considered Mr Zheng’s prospects of returning to work were “very poor” and that he would require domestic assistance for household maintenance and cleaning activities.
Professor Cumming, orthopaedic surgeon, examined Mr Zheng on 24 August 2007. Mr Zheng attended the interview with an interpreter and his flatmate, Mr Lin. Professor Cumming observed that Mr Zheng was “extremely depressed initially” and angry regarding the nature of his injury. It was a lengthy process to obtain an appropriate history, but after a significant amount of questioning and discussion, Mr Zheng provided the history and was cooperative and compliant during the examination. At the end of the interview, Mr Zheng was most pleasant in terms of thanking Professor Cumming for his attention to detail and courtesy to him.
Professor Cumming noted Mr Zheng to have a significant tremor (presumably of the left hand) and to have limited movement of the left wrist and significantly limited movement of his fingers. The result from surgical repair was “significantly suboptimal” and it was not likely there would be any significant change. In terms of Mr Zheng’s capacity of employment, Professor Cumming thought he could obtain employment using his right hand, for instance, stacking supermarket shelves. He added that Mr Zheng appeared to be “significantly depressed” and sits at home doing nothing or watching television and accepting assistance in showering and dressing.
Dr Westmore, forensic psychiatrist, examined Mr Zheng for medico legal purposes on 18 October 2007. The doctor’s report is dated 20 September 2007 and I assume that either his recording of the date of the examination is incorrect or the report should be dated 20 October 2007. A Mandarin speaking interpreter and a friend (presumably Mr Lin) accompanied Mr Zheng to the examination. The friend provided a lot of the history. Dr Westmore found Mr Zheng very difficult assess as, initially, he provided very few verbal responses to questions asked of him. During the interview he appeared to be irritated, mildly agitated and hostile. Dr Westmore thought Mr Zheng’s underlying mood was one of depression, probably a major depressive illness. Mr Zheng’s friend provided many of the responses to Dr Westmore’s questions. When the doctor asked the friend why Mr Zheng himself did not respond, the friend said “he is not comfortable with doctors, he has been like this with every doctor”. The friend added that Mr Zheng presented in a similar fashion with his lawyers. The friend also observed that at some stage Mr Zheng’s employers had “run away and did not take responsibility”.
Mr Zheng’s responses to Dr Westmore were limited to the following matters:
(a)he said that he was receiving workers compensation in relation to his left arm injury and that he had a scar on his arm;
(b)when asked about what time he went to bed, he said “if I feel sleepy I go to bed, if I wake I wake” (his friend said that Mr Zheng normally did not leave the house unless he needed to see a doctor or lawyer);
(c)he has trouble reading a lot because his concentration is poor (the friend added that Mr Zheng will not shower regularly unless pushed);
(d)in response to the doctor’s question of whether he was depressed, Mr Zheng said “I can’t answer that”;
(e)he said that his sleep was very “disordered, I sleep any time and only sleep for three or four hours before waking”;
(f)when asked about thoughts of self harm he said, “it is difficult for me to answer. Sometimes I feel sleepy”. He added, “sometimes I feel very bad mood”;
(g)he said that he smoked tobacco and drank sometimes and took “pain killers”, but denied using illicit drugs;
(h)he confirmed that both parents were alive and living together in China;
(i)he said that he was the third of four children and that he had worked as a truck driver before coming to Australia in January 2005;
(j)when asked whether he was on a working visa, he said the doctor should ask his lawyer those sorts of questions, and
(k)when asked if he had any girlfriends, he said “I don’t want to answer these questions. The lawyers had asked me this before, I don’t want to repeat again”.
At about this stage of the interview Mr Zheng was becoming irritated and showing signs of agitation and hostility. As a result, Dr Westmore decided not to proceed further with the formal interview. Under “Mental State Examination”, Dr Westmore noted that whilst Mr Zheng spoke in a very limited spontaneous way initially, that improved slightly as the interview progressed, but he mainly responded in a monosyllabic way to questions. His affect was initially flat, but, later, irritable and hostile. His provisional diagnosis was that Mr Zheng suffered from a major depressive illness. It was likely that Mr Zheng was experiencing numerous stressors including concerns about his left arm injury, financial and employment concerns, and significant social isolation because of his depression and language and cultural problems. Based on the history there appeared to be “a direct causal connection between the accident and the development of his depression”. At the time of the examination, Dr Westmore thought that Mr Zheng was totally unemployable from a psychiatric perspective.
Workcover qualified Dr Akkerman, psychiatrist, who examined Mr Zheng on 11 March 2008. Mr Zheng attended the consultation with an interpreter and a friend. The friend was asked to stay in the waiting room during the consultation. Dr Akkerman ascertained that Mr Zheng is right handed, but stated that he thought Mr Zheng was “evasive regarding this”, as he had to ask him “three or four questions”. In spite of repeated questioning, Mr Zheng never answered the question whether he believed he had a “psychological disorder”. Mr Zheng volunteered the following symptoms to Dr Akkerman; disturbed sleep, nightmares (mostly regarding the accident), irritability, boredom, not having friends, staying at home, and reduced concentration. On specific questioning, Mr Zheng added: his short-term memory was down, and his appetite and libido were also down. When asked if he was tearful, he refused to answer saying “this is bullshit”.
In respect of his developmental history, Dr Akkerman recorded that Mr Zheng’s childhood was happy and that he got on well with his siblings and had normal peer relationships. He enjoyed school and was an average student who did not get into trouble. He had no prior accidents or illnesses, played sport and was fairly popular. In terms of his work history, Mr Zheng drove trucks in China for a long time and was a labourer in Australia but had not worked since the accident.
Dr Akkerman felt that Mr Zheng was very evasive and that he told him about “nonsensical symptoms such as not remembering when he left school or how long he drove a truck for”. He felt that Mr Zheng exaggerated his symptoms, that his mood was irritable, but that appeared to be “under voluntary control”. He thought his concentration and memory, short term and long term, were normal. The doctor felt that there were no objective findings other than irritability. He did not believe there was a psychiatric diagnosis and thought that Mr Zheng was exaggerating for financial gain. From a psychiatric point of view he placed no restrictions on Mr Zheng’s ability to work.
Dr Horace Ting, occupational therapist and vocational assessor with “Injury Assess”, assessed Mr Zheng on 21 February 2008. In his report of 29 February 2008, Dr Ting made the following observations under “General Presentation”:
(a)he appeared nervous holding his left hand and did not allow eye contact. He was unable to communicate in English and spoke entirely through the interpreter, and
(b)Mr Zheng was a poor historian and appeared unable to express his feelings and emotions. His story was disjointed and some of his explanations were difficult to understand. He provided little information and became annoyed at the questioning conducted during the interview. He spoke with an aggressive tone.
Through an interpreter, Mr Zheng gave a history of his injury on 25 April 2005 when he was employed as a “carpenter/labourer for Mr Guo Yong Yang”. Mr Zheng worked full-time on a daily basis for approximately nine hours per day Monday to Friday renovating houses and fitting new houses with bathrooms. Dr Ting then recorded the following history:
“On the day of the accident Mr Zheng was working on his own on site, renovating an old house and he was replacing skirting boards. Whilst he was carrying out this work he needed to cut a skirting board with a hand grinder. As he attempted to cut the skirting board, Mr Zheng cut his left forearm. After the accident he managed to attract the attention of a neighbour. He spoke to the neighbour who offered to drive him to hospital. According to Mr Zheng, the drive was intercepted by an ambulance which had been called earlier by the neighbour and he continued his journey to Kogarah Hospital in the ambulance.”
On physical examination, Dr Ting noted the range of movement and strength of the left hand to be severely reduced. There was no thumb opposition. Opening and closing of the left hand was possible only with effort, but was not functional. There was “a trace of thumb flexion at the IP joint and thumb adduction with Grade 2 strength on the MMT scale”. Mr Zheng was not able to grip with his left hand. In terms of the functional assessments conducted, Mr Zheng was consistent in his efforts and the findings from physical examination were consistent with those of the functional assessment.
Under “Psychosocial History”, Dr Ting recorded that Mr Zheng lives an isolated life and socialises very little. Mr Zheng indicated significant physical sequelae as a result of the work accident with a decreased engagement in physically exerting activities. He reported experiencing frustration “giving persistent pain presentation”. Mr Zheng was unable to return to his pre-injury job and was not able to drive. He suffered poor sleep patterns, sleeping four hours at the longest. On the DASS 21 Self Rating Depression Scale, Mr Zheng scored 16 for depression, which is “extremely severe”. He reported that he withdraws, preferring not to socialise and becomes isolated. He feels a loss of motivation, loss of sense of purpose and lack of direction, and has difficulty with his attention span and concentration.
On arriving in Australia in 2005, Mr Zheng was introduced to his employer by a contact in the Chinese community and he commenced work soon after. At the time of the accident Mr Zheng said that he earned $860 gross per week, which was his maximum weekly income.
After conducting various vocational tests and noting that Mr Zheng has no English language skills, Dr Ting concluded “Mr Zheng has a very little chance in [sic] gaining and maintaining any employment in the open labour market”. Mr Zheng has developed reclusive habits and does not have reliable transportation. In conclusion, while Dr Ting thought that Mr Zheng demonstrated a residual capacity to perform part-time sedentary work using his right hand, he added that Mr Zheng was not work ready and did not “demonstrate any earning potential at this stage”. Due to the severe nature of Mr Zheng’s physical and psychological injuries, Dr Ting envisaged that Mr Zheng would have “difficulty securing and maintaining any employment”.
SUBMISSIONS
Essentially, Workcover’s case is that the claim is so riddled with inconsistencies that I would not be satisfied that Mr Zheng was employed by Mr Yang at the time of the accident and therefore his claim must fail. Specifically, Mr Baker makes the following points:
(a)in a document from St George Hospital headed “St George Hospital Hand Clinic” there is no entry under the heading “Work Comp” or under the heading “Name and Address of Employer”. The notes from the Hand Clinic start on 3 May 2005 and record that Mr Zheng was accompanied by a person called Joyce who acted as an interpreter on that day;
(b)Mr Zheng’s attendances at the Hand Clinic were irregular and he did not attend on 13 July 2005 or on 9, 18 or 31 August 2005;
(ll)the inconsistency as to who introduced Mr Zheng to Mr Yang has not been explored or explained in the evidence and is not of critical importance;
(mm)the particulars from Keddies to Kerrigans dated 21 December 2005 are inconsistent with Mr Zheng’s statement in that they only refer to one other employer (TFH Temporary Fencing Pty Ltd) rather than the two referred to in Mr Zheng’s statement of 15 June 2007. I do not believe anything of significance turns on this discrepancy;
(nn)the statutory declaration of 4 August 2005 suggesting that Mr Zheng only worked for Mr Yang until 24 April 2005 was incorrect and was later corrected by the accountants who prepared it. I do not accept that anything turns on this error;
(oo)Mr Zheng’s exact period of employment with the two furniture companies is not known. I accept Mr Zheng’s evidence that the money he deposited in his bank account on 6 April 2005 was more probably than not money he received for work done by him for Mr Yang at 23 Berrille Road. That is consistent with Mr Zheng’s evidence that he opened the account with the assistance of Mr Yang and Ms L Lu. I do not, however, accept that the deposit of $1,000 was consistent with Mr Zheng being paid only $500 per week, as it is not known what other deductions were made by Mr Yang before he made that deposit;
(pp)the submission that Mr Yang is a “mythical character” is contrary to objective evidence (for example, the RTA certificate) and should not have been made. I have no doubt that Mr Yang does exist;
(qq)I do not accept that the hospital notes of 25 April 2005 accurately recorded Mr Zheng’s employment situation and accept Mr Zheng’s evidence that Mr Yang employed him. I accept that the statutory declaration that suggested that Mr Zheng worked for Mr Yang until 24 April 2005 was an error;
(rr)I accept that the Refugee Tribunal had reservations about Mr Zheng’s evidence in respect of his association with Falun Gong. Those issues are not determinative, or even directly relevant, to the issues in dispute before me. Whilst there are several inconsistencies in Mr Zheng’s case, I have to weigh those inconsistencies with the whole of the evidence to determine if Mr Zheng has established his case on the balance of probabilities. I am satisfied that he has;
(ss)I do not accept Dr Akkerman’s description of Mr Zheng as being evasive or that the symptoms of which he complained were “nonsensical”. His symptoms were consistent with the symptoms he listed in his statements filed in support of his cliam and with the symptoms recorded by Dr Westmore and Dr Ting. I am not surprised that Mr Zheng was unable to say if he had a “psychological disorder”, he is not a medical practitioner and would be most unlikely to have sufficient knowledge or insight to answer that question. Mr Zheng’s presentation to Dr Akkerman was consistent with his presentation to every medical practitioner in the case, save for Dr Vago. He was aggressive and irritable. Dr Akkerman provided no basis for his conclusion that Mr Zheng was exaggerating for financial gain and I do not accept that opinion.
It follows that having considered all of the evidence and submissions, notwithstanding the reservations I have expressed about Mr Li’s evidence and the inconsistencies in Mr Zheng’s evidence, I find that Mr Zheng was employed by Mr Yang under a contract of service in or about April 2005 for the purpose of laying timber floor boards at 23 Berrille Road, Narwee and that whilst he was engaged in that activity he sustained a serious injury to his left forearm, as detailed in the medical evidence. I accept Mr Zheng’s evidence, both as to the circumstances of his employment with Mr Yang and the circumstances of the accident. I place particular weight on the following matters:
(a)there is no dispute that Mr Zheng sustained a serious injury while using a cutting device at 23 Berrille Road on 25 April 2005;
(b)Mr Zheng has given a consistent history to all the expert witnesses in this case about the circumstances of his injury and he was employed by Mr Yang at the time of the injury;
(c)the initial WorkCover certificate from St George Hospital Hand Clinic, dated 9 May 2005, corroborates Mr Zheng’s evidence as to the circumstances of the injury and the identity of his employer;
(d)the entry of a cash deposit of $1,000 in Mr Zheng’s bank account on 26 April 2005 (when he was in hospital) corroborates Mr Zheng’s evidence that Mr Yang paid that sum into his account on that day. It is extremely improbable that that payment came from a source other than Mr Yang or was paid for a reason other than that identified by Mr Zheng. The probability is, and I find, that the money was paid by Mr Yang in return for work done by Mr Zheng for Mr Yang at 23 Berrille Road in the weeks immediately preceding the payment;
(e)even if Mr Zheng lived at 23 Berrille Road as a tenant or licensee, which I do not accept, there is no plausible reason why he would work on the property as a volunteer on 25 April 2005. There is no logical reason why he would have engaged in the activity of cutting the skirting boards as a volunteer and I reject that suggestion as no more than a theory unsupported by any probative evidence;
(f)there is no persuasive evidence that Mr Zheng was working as an independent contractor on 25 April 2005 and I do not accept that that was the case;
(g)Mr Lin and Ms Lau support the consistency of Mr Zheng’s claim that he was working for Mr Yang using a grinder to cut wood when he received his injury, and
(h)the alternative, which I do not accept, is that all the witnesses in this case have conspired to manufacture or support a deliberately false claim for compensation.
The Section 20 Principal Issue
Section 20(1) of the 1987 Act provides:
“20 Principal liable to pay compensation to workers employed by contractors in certain cases
(1) If any person (in this section referred to as ‘the principal’) in the course of or for the purposes of the person’s trade or business, contracts with any other person (in this section referred to as ‘the contractor’) for the execution by or under the contractor of the whole or any part of any work undertaken by the principal, the principal is, if the contractor does not have a policy of insurance or is not a self-insurer at the time a worker employed in the execution of the work receives an injury, liable to pay any compensation under this Act which the principal would have been liable to pay if that worker had been immediately employed by the principal.”
Mr Baker argued, both before the Arbitrator and on appeal, that:
(a)Mr Yang had a contract to perform work (T130.3);
(b)the work was on rental premises, 23 Berrille Road, with the owners of those premises, the Third Respondents (T130.4), and
(c)the Third Respondents were “renting them [the premises] out” (T130.5) and that would seem to fall within the business of that principal (T130.9).
The basis for the submission that there was a contract between Mr Yang and the Third Respondents is “the inference from the material that flows from Mr Zheng’s other statements…, which indicate there was some agreement that presumably Mr Yang wasn’t doing this for love, notwithstanding the fact that it is said to be his girlfriend’s sister’s premises and one other person” (T130.37).
Reliance is also placed on the particulars provided by Mr Zheng’s solicitors in response to Kerrigan’s request for particulars dated 23 November 2005. Question 19 from Kerrigan’s asked, “Who was the person/entity who engaged your client and/or others to work at this location [23 Berrille Road]?”. In response, Keddies wrote on 21 December 2005:
“Mr Yang’s girlfriend Chan Lian Lu, phone number 0410 268 408 who resides at 10 Elliston Avenue, Narwee NSW 2209 is the owner of 23 Berrille Road, Narwee and it was through Mr Yang’s girlfriend that Mr Yang obtained the job to work at [the] premises 23 Berrille Road, Narwee.”
On appeal, Mr Baker submitted that:
“Surely, Mr Yang, he being a carpenter who works at various places according to all the statements gets paid for the work he does and it wasn’t probably an improbable proposition that two people who run a house with half a dozen tenants in it and who are repairing it to make the room habitable for a tenant aren’t [sic, are] running the business of a tenancy house or a boarding house or whatever.”
I do not believe the evidence supports Mr Baker’s submissions. For a party to rely upon section 20, it is necessary to establish several things:
(a)a contract between a “principal” and a “contractor”;
(b)that the principal contracted in the course of or for the purpose of the principal’s trade or business;
(c)that the contract is for the execution of work “by or under” the contractor of “the whole of part of any work undertaken by the principal”;
(d)a worker employed in the execution of the work received an injury, and
(e)the contractor does not have any workers compensation insurance at the time of the injury.
There is no evidence of the existence of a contract between Mr Yang and the Third Respondents. Ms L Lu’s sister and mother owned the property at 23 Berrille Road. It is possible that Mr Yang performed the work under a contract with the Third Respondents. It is equally possible that Mr Yang performed the work as part of an arrangement with Ms L Lu. There is no direct evidence. Where direct proof is not available it is possible to draw an inference from known facts. However, those facts must do more than “give rise to conflicting inferences of equal degree of probability so that the choice between them is [a] mere matter of conjecture” (per Dixon J (as he then was), Williams, Webb, Fullagar and Kitto JJ in Bradshaw v McEwans Pty Ltd (unreported, High Court, 27 April 1951), cited by Williams, Webb and Taylor JJ in Holloway v McFeeters [1956] HCA 25: 94 CLR 470 at 480-481). The law “does not authorise a court to choose between guesses” (per Dixon CJ in Jones v Dunkel [1959] HCA 8; 101 CLR 298 at 305). The evidence does not support a finding, inferentially or otherwise, of a contract between Mr Yang and the Third Respondents.
If I am wrong on this issue and it is appropriate to infer that the work performed by Mr Yang was performed under a contract with the Third Respondents, section 20 is not satisfied by the mere existence of such a contract. The contract must be one entered “in the course of and for the purpose of” the principal’s trade or business for the execution by or under the contractor (Mr Yang) of the whole or part of “any work undertaken by the principal”. The evidence establishes that, as at 25 April 2005, Ms E Lu and Mrs Chung owned 23 Berrille Road as joint tenants and that they rented that property, or parts of it, to various people.
The evidence does not, however, establish that they conducted a trade or business, or that the work being performed by Mr Yang was part of any work (or business) undertaken by them. I note that the expression “work undertaken by the principal” is not limited to work that the principal has contracted to do for someone else, but also covers any work that is part and parcel of the business undertaking of the principal (per Dixon CJ in Frauenfelder v Reid [1963] HCA 3; (1963) 109 CLR 42 at 50). The mere fact that a person owns and rents a residential property does not establish that he or she conducts the business of a boarding house. It is not known what business, if any, Ms E Lu and Mrs Chung conducted. It is possible that they conducted the business of a boarding house, but it is equally possible that they merely owned 23 Berrille Road as a negatively geared investment property and that it required repairs. I am therefore not satisfied that, if there was a contract between Mr Yang and the Third Respondents, section 20 applies.
The Arbitrator erred in finding to the contrary.
Mr Zheng’s Entitlement to Compensation
Incapacity
Is Mr Zheng totally or partially incapacitated for work? For the following reasons, I find that he was and is totally unfit for work:
(a)his injury resulted in several nerves, tendons and muscles being severed (see [52] above). Whilst the Hand Clinic suggested some signs of improvement in Mr Zheng’s hand in 2005 and 2006, I accept Dr Bodel’s opinion that Mr Zheng remains with a grossly restricted range of wrist flexion and extension, restricted movement of his fingers, and numbness in the radial, median and ulnar nerve distributions. He has difficulty with all household maintenance and cleaning activities and I do not believe he could perform any job that requires average bilateral manual dexterity, such as processing work or labouring activities;
(b)I accept Dr Westmore’s conclusion, which is consistent with Dr Ting’s testing and Mr Zheng’s evidence, that Mr Zheng suffers from severe depression as a result of his accident and that from a psychiatric perspective Mr Zheng is totally unemployable;
(c)I accept Dr Ting’s evidence that Mr Zheng is incapable of undertaking a driving job;
(d)Dr Ting’s consultation and functional testing was detailed and comprehensive. Whilst Dr Ting referred to Mr Zheng having a residual capacity to perform part-time sedentary work using his right hand, given his physical and psychological symptoms, I do not believe such employment is a viable option for him. Similarly, I do not accept Professor Cumming’s conclusion that Mr Zheng could work using his right hand only. The Commission is concerned with the assessment of a capacity “for work” having regard to the realities of the labour market in which the worker is to be engaged (Lawarra Nominees Pty Ltd v Wilson (1996) 25 NSWCCR 206). Taking into account Mr Zheng’s injury and its consequences for him, his background, education, lack of English and lack of any transferable skills, I find that he has no residual earning capacity and that he was and is totally unfit for work.
Whilst the evidence is far from ideal, doing the best I can, I accept that Mr Yang paid Mr Zheng $120 per day and, therefore, that the appropriate current weekly wage rate is $600.00 per week.
Dependency
The section 74 notice did not dispute dependency and WorkCover made no application for leave to put that issue in dispute. A child can be dependent for support on both parents and the obligation on each parent to provide support is joint and several (see Coles Myer Ltd v Rudzinski [2006] NSWCA 161, (2008) 5 DDCR 36; McCaffery’s Management Pty Ltd v Pimlott (1995) 12 NSWCCR 360; Holdlen Pty Ltd v Walsh (2000) 19 NSWCA 629, [2000] NSWCA 87). In these circumstances, Mr Zheng is entitled to recover compensation on the basis that his child was and is dependent for support on him.
Lump Sum Compensation
Section 65A(1) of the 1987 Act provides:
“65A Special provisions for psychological and psychiatric injury
(1) No compensation is payable under this Division (either as permanent impairment compensation or pain and suffering compensation) in respect of permanent impairment that results from a secondary psychological injury.”
The term “secondary psychological injury” is defined in Section 65A(5) to mean “a psychological injury to the extent that it arises as a consequence of, or secondary to, a physical injury.” The term “primary psychological injury” means “a psychological injury that is not a secondary psychological injury.”
Mr Taylor submits that it is possible to have both a physical injury and a primary psychological injury as a result of the one incident. However, without deciding if that is correct, the evidence does not support that conclusion in the present matter. Dr Westmore concluded that, on the history he received, which I have found to be correct, there was “a direct causal connection between the accident and the development of his depression”. Based on Dr Westmore’s opinion as to the cause of Mr Zheng’s psychological injury, I am satisfied, and I find, that Mr Zheng’s psychological injury is a secondary psychological injury, as defined in section 65A(5) of the 1987 Act. Therefore, there is no need for a separate referral to an AMS for assessment of any whole person impairment that may have resulted from that injury, because, by reason of the operation of section 65A, there is no entitlement to lump sum compensation.
CONCLUSION
I am satisfied that in or about April 2005 Mr Yang engaged Mr Zheng under a contract of service to perform work at 23 Berrille Road, Narwee and that while performing that work on 25 April 2005, Mr Zheng sustained a serious laceration to his left forearm when a grinder slipped. I am satisfied that the injury was caused by or arose out of Mr Zheng’s employment with Mr Yang and that his employment was a substantial contributing factor to the injury. I am not satisfied that the Third Respondents were principals under section 20 of the 1987 Act. I find that, as at 25 April 2005, Mr Yang was not insured under the 1987 Act.
DECISION
Paragraphs two and three of the Arbitrator’s determination of 4 August 2008 are revoked and the following findings and orders are made:
“1.That the employer, Guo Yong Yang, was not insured as required by the Workers Compensation Act 1987 (‘the 1987 Act’) at the time of the applicant, Shao Wen Zheng’s, injury.
2.That the applicant, Shao Wen Zheng, has one child, Kai Yuan Zheng, born on 15 July 2003, totally or mainly dependent for support on him.
3. Award for the applicant, Shao Wen Zheng, against the first respondent, Guo Yong Yang, under section 36 of the 1987 Act in the sum of $600.00 per week from 4 July 2005 until 24 October 2005, and under section 37 at the statutory rate of compensation for a worker with one dependent child from 25 October 2005 to date and continuing.
4.Guo Yong Yang is to pay Shao Wen Zheng’s reasonable hospital and medical expenses under section 60 of the 1987 Act.
5.That the WorkCover Authority of NSW, acting for the Nominal Insurer, pay to the applicant, Shao Wen Zheng, the compensation and costs awarded against Guo Yong Yang from the Workers Compensation Insurance Fund (‘the Fund’) established under section 154D of the 1987 Act.
6.That the employer, Guo Yong Yang, reimburse the WorkCover Authority of NSW, acting for the Nominal Insurer, for:
(a)amounts paid out of the Fund in respect of compensation and costs awarded against the employer, and
(b)the costs of the WorkCover Authority of NSW.
7.The matter is remitted to the Registrar for referral to an Approved Medical Specialist for assessment of Shao Wen Zheng’s whole person impairment as a result of the injury to his left upper limb on 25 April 2005.
8. Award in favour of the Third Respondents.”
Paragraphs one, four and five of the Arbitrator’s determination of 4 August 2008 are confirmed.
The parties are given leave to apply within seven days of the date of this decision, if any amendment to the above orders or any further or incidental order is required.
COSTS
Whilst WorkCover has succeeded in its appeal on the procedural fairness issue, it has ultimately failed in the action and failed in Mr Zheng’s appeal. Therefore, the appropriate costs order is: the WorkCover Authority of NSW is to pay Shao Wen Zheng’s costs in appeal A1-2974/08 and in appeal A2-2974/08.
Bill Roche
Deputy President
9 December 2008
I, TUYET WALLIS, 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
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