South Western Sydney Area Health Service v Edmonds

South Western Sydney Area Health Service (the appellant) appealed to the Court of Appeal of New South Wales against a decision of the Deputy President of the Workers Compensation Commission. The dispute concerned whether the Arbitrator's conduct in formulating the case for the claimant and then finding it proved amounted to actual bias and constituted an error of law.

The Court was required to determine whether the Arbitrator, in proceeding to formulate the case for the claimant and subsequently finding that case proved, had demonstrated actual bias. Further, the Court had to consider whether this conduct constituted an error of law, particularly in light of the Arbitrator's obligation to act in accordance with equity, good conscience, and the substantial merits of the case, without being bound by strict rules of evidence.

The Court of Appeal found that the Arbitrator's conduct in formulating the claimant's case and then finding it proved demonstrated a prejudgment of the issues, which amounted to actual bias. The Court reasoned that while an Arbitrator is not bound by formal rules of evidence and must act in accordance with equity and good conscience, this does not permit the Arbitrator to adopt a partisan role or to prejudge the outcome of the proceedings. The Arbitrator's actions went beyond assisting the parties and instead involved the Arbitrator effectively presenting and then validating the claimant's case, thereby undermining the appearance and reality of impartiality.

Consequently, the appeal was allowed, the Deputy President's decision was set aside, and the matter was remitted to the Commission for determination by a Presidential member. The respondent was ordered to pay the costs of the appeal.