Superior Formwork Pty Ltd v Livaja
[2009] NSWWCCPD 158
•17 December 2009
| WORKERS COMPENSATION COMMISSION | ||||||
| DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR | ||||||
| CITATION: | Superior Formwork Pty Ltd v Livaja [2009] NSWWCCPD 158 | |||||
| APPELLANT: | Superior Formwork Pty Ltd | |||||
| RESPONDENT: | Marko Livaja | |||||
| INSURER: | Employers Mutual NSW Limited | |||||
| FILE NUMBER: | A1-2958/09 | |||||
| ARBITRATOR: | Ms A Nicholl | |||||
| DATE OF ARBITRATOR’S DECISION: | 20 August 2009 | |||||
| DATE OF APPEAL HEARING: | 10 December 2009 | |||||
| DATE OF APPEAL DECISION: | 17 December 2009 | |||||
| SUBJECT MATTER OF DECISION: | Status of a Medical Assessment Certificate in subsequent proceedings; section 326 of the Workplace Injury Management and Workers Compensation Act 1998; failure to give reasons; failure to consider the employer’s expert evidence; failure to determine worker’s ability to earn; section 40(2)(b) Workers Compensation Act 1987; whether the effect of the work injury had ceased | |||||
| PRESIDENTIAL MEMBER: | Deputy President Bill Roche | |||||
| HEARING: | Oral | |||||
| REPRESENTATION: | Appellant: | Mr Wardell, solicitor, Edwards Michael Lawyers | ||||
| Respondent: | Mr Stockley, instructed by NSW Compensation Lawyers | |||||
| ORDERS MADE ON APPEAL: | For the reasons given in this decision, the Arbitrator’s determination of 20 August 2009 is confirmed. The matter is remitted to the Registrar for determination of any outstanding issues. | |||||
| The appellant employer is to pay the respondent worker’s costs of the appeal. Those costs are assessed at $2,200.00 plus GST. | ||||||
INTRODUCTION
This appeal concerns three main issues:
(a)the status in the current proceedings of a Medical Assessment Certificate (‘MAC’) obtained in previous proceedings between the same parties when those proceedings were discontinued without any determination by the Commission;
(b)whether, by failing to refer to any of the employer’s medical or other expert evidence, the Arbitrator failed to give reasons, and
(c)whether an Arbitrator is entitled to find that the effect of an injury has ceased.
BACKGROUND
The worker, Mr Livaja, injured his neck, back, right shoulder and right elbow in the course of his employment as a formwork carpenter with Superior Formwork Pty Ltd (‘Superior Formwork’) when he fell whilst carrying a five metre long ‘bearer’ or ‘header’ on 7 March 2005. His claim was initially accepted and voluntary compensation paid until 14 November 2005.
In proceedings registered in the Commission on 26 October 2006 in matter number 16951-06 (‘the first proceedings’), Mr Livaja claimed weekly compensation from November 2005 to date and continuing, and lump sum compensation in respect of an alleged whole person impairment in respect of his cervical spine and lumbar spine as a result of injury to his neck and low back on 7 March 2005.
The Commission referred that claim for assessment by an Approved Medical Specialist (‘AMS’). The AMS, Dr Harrison, issued a MAC on 11 April 2007 in which he assessed Mr Livaja to have nil whole person impairment in respect of both his cervical spine and his lumbar spine. He made no assessment of the impairment resulting from Mr Livaja’s right shoulder injury, as the referral had not asked him to do so.
On 8 May 2007, Mr Livaja appealed Dr Harrison’s assessments to a Medical Appeal Panel (‘the Appeal Panel’) on the grounds that they had been made based on incorrect criteria and contained a demonstrable error.
On 20 September 2007, an Appeal Panel revoked Dr Harrison’s MAC and issued a new MAC finding a nil whole person impairment in respect of the cervical spine and, after allowing a deduction for a pre-existing condition or abnormality, a 5 per cent whole person impairment in respect of the lumbar spine.
The MACs issued by Dr Harrison and by the Appeal Panel were issued in “matter number 16951-06” and that number appears on the face of each document.
On 2 October 2007, Mr Livaja sought a reconsideration of the Appeal Panel’s decision. In a letter dated 15 November 2007, the Registrar advised the parties that the reconsideration was unsuccessful and that the Appeal Panel declined to vary its original Statement of Reasons and conclusions.
On 12 December 2007, the Commission issued a Certificate of Determination – Consent Orders in which an Arbitrator granted leave to Mr Livaja to discontinue the first proceedings without filing a Notice of Discontinuance. The Commission made no order as to costs but certified that the employer’s solicitor had an entitlement to costs incurred in respect of Mr Livaja’s unsuccessful application for a reconsideration of the Appeal Panel decision.
In an Application to Resolve a Dispute (‘the Application’) registered in the Commission on 20 April 2009 (‘the current proceedings’), Mr Livaja sought weekly compensation from 14 November 2005 to date and continuing, lump sum compensation in respect of whole person impairment in respect of his cervical spine, lumbar spine and right upper extremity (right shoulder), and hospital and medical expenses.
After an aborted hearing on 12 June 2009, the arbitration proceeded on 27 July 2009. The parties agreed that the following matters remained in dispute:
(a)whether the matter could or should be referred afresh to a new AMS or, in the alternative, whether it could or should be referred to the original AMS, another AMS, or the original Appeal Panel under section 329 of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’);
(b)whether the effect of the right shoulder injury had ceased;
(c)whether Mr Livaja was totally or partially incapacitated for work from 14 November 2005 to date and continuing, and, if only partially incapacitated, the extent of that incapacity, and
(d)whether Mr Livaja’s hospital and related expenses were reasonably necessary as a result of his injury.
It has never been disputed that Mr Livaja fell at work on 7 March 2005, or that he injured his neck, back, and right shoulder in that fall. The parties have agreed that the whole person impairment as a result of the lumbar spine (back) condition resulting from the back injury is 5 per cent, as certified by Dr Harrison.
After hearing submissions from both sides, the Arbitrator reserved her decision. In a Statement of Reasons (‘Reasons’) delivered on 20 August 2009, the Arbitrator found Mr Livaja to be partially incapacitated for work and entitled to an award at the maximum statutory rate of compensation for a worker with no dependants from 14 November 2005 to date and continuing.
In respect of the claim for lump sum compensation, the Arbitrator found that the effect of the right shoulder injury was continuing, but added that she had no power to make a contrary finding. She declined to make orders under section 329 of the 1998 Act. Instead, after reviewing the Appeal Panel’s reasons, she referred the matter to the Registrar under section 321 of the 1998 Act for referral to an AMS for assessment of the degree of permanent impairment of the cervical spine (neck) and right upper extremity (right shoulder) conditions as a result of the injury on 7 March 2005.
The Commission issued a Certificate of Determination on 20 August 2009 in the following terms:
“The Commission determines:
Orders
1.The Respondent is to pay the Applicant weekly benefits compensation at the maximum statutory rate for a single worker with no dependants pursuant to section 40 of the 1987 Act from 14 November 2005 to date and continuing.
2.The Respondent is to pay the Applicant’s reasonably necessary
section 60 expenses on the production of accounts and/or receipts.
3.I remit the matter to the Registrar for referral to an Approved Medical Specialist for assessment of the degree of permanent impairment, if any, in respect of the cervical spine and right upper extremity as a result of the injury on 7 March 2005. That assessment is to be undertaken in accordance with the WorkCover Guides for the Evaluation of Permanent Impairment. The documents to be sent to the AMS are those accepted into these proceedings. I direct that a copy of this Statement of Reasons is to be sent to the AMS.
4.The Respondent is to pay the Applicant’s costs as agreed or assessed. The Respondent is to pay the Applicant’s costs as agreed or assessed. For the purposes of Schedule 6 Table 4 Item 4 of the Workers Compensation Regulation 2003 I certify this matter as complex with 20% increase in the costs otherwise available to the parties.”
In an appeal filed on 17 September 2009, Superior Formwork seeks leave to appeal the Arbitrator’s determination in relation to the award of weekly compensation, the referral of the claim for lump sum compensation in respect of the cervical spine, and the finding that the effect of the injury to the right shoulder has not resolved.
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.
The monetary thresholds in section 352(2) of the 1998 Act are satisfied.
Time
The appeal was lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act.
I grant leave to appeal.
PRELIMINARY MATTERS
At a teleconference on 19 November 2009, I informed the parties’ legal representatives that both sides appeared to be in breach of clause 43 of the Workers Compensation Commission Regulation 2003 (‘the Regulation’). Whilst the parties expressed preliminary views about which reports they felt came within the terms of clause 43 and which did not, I made no ruling.
At the oral hearing of the appeal counsel for Superior Formwork, Mr Wardell, withdrew reliance on reports from Drs Mills and Rowe and sought to rely on reports from Drs Keighery and Burke. He submitted that Dr Keighery’s reports were not forensic medical reports obtained for the purpose of proving or disproving an entitlement but were merely injury management reports obtained for the purpose of managing or overseeing Mr Livaja’s return to work.
Whilst the referral letter to Dr Keighery is not in evidence, the content of his reports and the fact that Dr Keighery liaised with Mr Livaja’s treating doctor about Mr Livaja’s return to work on restricted hours strongly suggests that that is correct. I therefore allow Superior Formwork to rely on the reports from Drs Keighery and Rowe.
Counsel for Mr Livaja, Mr Stockley, withdrew reliance upon the report from Dr Matalani dated 20 November 2008 and, without objection, sought to rely on reports from Dr Bodel.
THE EVIDENCE
Mr Livaja’s evidence is set out in his statement dated 1 February 2008. He was not cross-examined. He was born in Bosnia in 1956. He left school at the age of 15 and then worked on a farm for about three years. He was in the Yugoslavian army from 1975 to 1977. From 1978 to 1985, he worked in various factory jobs. Between 1985 and 1991, he looked after his father’s farm. From 1991 to 1995, he was again in the armed services. He did not work from 1995 and he came to Australia in 1999.
From 1999 until 2004, he worked as a labourer with various formwork companies until he started with Superior Formwork as a formwork labourer in about June 2004.
On 7 March 2005, Mr Livaja was working at a work site at a shopping centre near Castle Hill. The work involved a “stripping process”. Mr Livaja had to collect building materials such as timber, headers and plywood and stack them. In the course of that work, Mr Livaja picked up a ‘header’ or ‘bearer’ weighing between 30 and 50 kilograms. As he was walking with it, he turned slightly to his left and the back of the bearer struck a metal frame causing him to lose his balance and fall, landing on his right side and right shoulder. As he fell, he also struck his low back and neck on the concrete surface. His back also struck a cylindrical metal joint 15 centimetres long by 5 centimetres in diameter. He felt immediate pain in his neck, low back, right shoulder and right elbow. He was in excruciating pain and felt sick and dizzy.
A co-worker assisted Mr Livaja to his feet and helped him to the first aid office where the first aid officer sprayed his back and bandaged his right shoulder. A co-worker then drove him to a medical centre at Castle Hill where he was certified unfit for work from 7 until 10 March 2005. Another co-worker drove him to see his own doctor, Dr Mattar, who certified him unfit until 11 March 2005 and ordered x-rays for his back, neck and right shoulder.
On 14 March 2005, Mr Livaja changed general practitioners to Dr Tomasevic, a doctor who speaks Mr Livaja’s language. Dr Tomasevic referred him to Dr Giblin, orthopaedic surgeon, who referred him for physiotherapy and hydrotherapy and arranged for a number of further x-rays and scans. At that stage, Mr Livaja had constant pain in his neck, right shoulder, back and left leg. He was taking voltaren and panadol, but they did not really ease his pain.
Mr Livaja attempted to return to work on light duties on a few occasions, but was unable to manage the duties provided. Those duties included stacking materials like headers and timber and were the same as his pre-injury duties. Superior Formwork terminated his employment on 15 September 2005.
Mr Livaja stopped seeing Dr Tomasevic on 24 October 2005 and changed to Dr Pukanic, who remained his general practitioner as at the date of his statement in February 2008.
Mr Livaja’s right elbow pain resolved with time, but he continues to have pain in his neck, low back, right shoulder and left leg. That pain is constant and is neither improving nor deteriorating. His neck pain restricts the movement of his head from side to side and up and down. His shoulder pain restricts his ability to lift his right shoulder. His low back pain causes difficulty with walking and bending and his left leg pain prevents him from walking long distances. Any type of physical activity causes more low back pain, as does coughing and sneezing. He also complains of numbness in his right shoulder radiating down his arm to his fingers.
Mr Livaja’s medical evidence
Dr Tomasevic saw Mr Livaja for the first time on 14 April 2005. In his report to Mr Livaja’s solicitors on 28 November 2008, he recorded Mr Livaja was carrying timber at work on 7 March 2005 and, as he tried to turn, the timber caught on the frame of a building and he fell onto a frame on the ground. Mr Livaja complained of pain in his neck, right shoulder, right elbow, low back and both legs. He denied having had any previous problems with his neck, back or his upper or lower limbs prior to 7 March 2005.
Dr Tomasevic last treated Mr Livaja on 28 July 2006. He thought Mr Livaja was fit for work for three hours per day two days per week with a lifting restriction of three kilograms, sitting up to 30 minutes, travelling up to 30 minutes, walking up to 20 minutes, standing up to 20 minutes, and rest breaks as necessary. He felt it unlikely that Mr Livaja would be able to return to his pre-injury duties.
Despite physiotherapy, Mr Livaja continued to complain of headaches, pain in his neck, right shoulder, right elbow, right upper limb, lower back and both legs.
Mr Livaja saw Dr Giblin on 19 April 2005. Dr Giblin recorded Mr Livaja’s symptoms in order of severity to be low back pain, neck pain, right shoulder pain, and paraesthesia in both legs. Dr Giblin found it difficult to examine the worker because of “cog wheel rigidity”. Deep tendon reflexes were preserved and equal in the arms and legs, but the right supraspinatus muscle bulk was slightly less compared to the left side.
At review on 9 June 2005, Dr Giblin noted an MRI scan of the cervical spine dated 2 June 2005 showed disc bulging at C4/5 and C5/6. An MRI scan of the lumbar spine of the same date showed arthritic changes at L4/5 with a disc bulge at the same level with a small impingement of the L5 nerve root. He did not consider these changes to be “sinister or surgical in nature” and he recommended a conservative treatment program.
At review on 1 August 2005, Dr Giblin examined an MRI scan of the right shoulder dated 7 July 2005, which revealed arthritis in the AC joint but no structural damage to the rotator cuff. He thought that Mr Livaja’s neck symptoms were probably emanating from his AC joint and referred pain from his neck.
In his report of 30 March 2006, Dr Giblin diagnosed a soft tissue injury to the cervical and lumbar spines. He thought it likely that the symptoms in the arms and shoulders were referred from Mr Livaja’s neck. He thought the symptoms were likely to “persist indefinitely” and be associated with increased propensity to further soft tissue injury and post-traumatic degenerative changes, and with permanent physical restrictions. Mr Livaja was permanently unfit for heavy lifting or heavy labouring duties, but was fit for sedentary work. Though surgery was not indicated at the time of his report, Dr Giblin thought it could not be excluded in the future and that it may take the form of a discectomy and fusion in the cervical spine or a simple discectomy in the lumbar spine. In a separate report of the same date, Dr Giblin assessed Mr Livaja to have a 15 per cent whole person impairment as a result of the condition of his cervical spine and lumbar spine.
The AMS, Dr Harrison, examined Mr Livaja on 22 March 2007 and issued a MAC on 11 April 2007. He stated that Mr Livaja had the “affect and demeanour of a man projecting abnormal illness behaviour”. Under “summary of injuries and diagnoses”, Dr Harrison stated that Mr Livaja had “aggravated pre-existing degenerative changes in his neck and lumbar spines and has done no frank injury to the right shoulder”. He felt that the changes evidenced by the MRI imaging were “representations of pre-existing asymptomatic degenerate changes present in those two areas [the cervical spine and the lumbar spine] before this injury occurred”. Mr Livaja had no right elbow discomfort at the time of Dr Harrison’s examination. Dr Harrison assessed a nil impairment of the cervical spine and a nil impairment of the lumbar spine. As the referral did not ask him to do so, he made no assessment of impairment as a result of the right shoulder injury.
An Appeal Panel revoked Dr Harrison’s MAC on 16 September 2007 on the grounds that the MRI scan of the lumbar spine was “concordant with radicular complaint on the left, this being sufficient to overcome any inconsistency in presentation or projection of an abnormal illness behaviour as otherwise noted by the AMS” (Appeal Panel’s Statement of Reasons for Decision at [18]). That scan revealed a protrusion on the left hand side, which was consistent with radicular complaint on that side which placed Mr Livaja’s lumbar spine in Category II. After making a 10 per cent reduction for the pre-existing condition of Mr Livaja’s spine, the Appeal Panel assessed a 5 per cent whole person impairment as a result of the condition of his lumbar spine.
It did not consider Dr Harrison to have erred in his assessment of Mr Livaja’s cervical spine, which it found to be consistent with “the information supplied to the AMS, the history taken on examination and the physical examination by the AMS”. The Appeal Panel conducted its review on the papers without an oral hearing and without re-examining Mr Livaja. It issued a fresh MAC certifying nil impairment due to the condition of the cervical spine and 5 per cent impairment due to the condition of the lumbar spine.
Dr Bodel examined Mr Livaja for medico-legal purposes on 5 December 2007. In his report of the same date, he noted that Mr Livaja complained of tenderness in the trapezius muscles at the base of the neck on both sides. He had only a few degrees of movement in any direction in the cervical spine and he had a reduced range of shoulder movement on both sides, but no visible wasting of either shoulder girdle. On the right hand side, Mr Livaja had 90 degrees of flexion, 40 degrees of extension, 40 degrees of adduction, 90 degrees of abduction, 60 degrees of internal rotation and 60 degrees of external rotation. On examination of the lower back, Mr Livaja had only a few degrees of forward flexion, extension or lateral bending. Straight leg raising was 60 degrees on both sides.
Dr Bodel noted that the MRI scan of the cervical and lumbar spines dated 2 June 2005 confirmed disc pathology in the cervical region and at L4/5 and L5/S1 in the lumbosacral region. The MRI scan of the right shoulder also confirmed that there was “some degenerative change in the humeral head adjacent to the attachment of the infraspinatus”.
Dr Bodel concluded that Mr Livaja had “clinical evidence of probable disc pathology in the cervical spine and in the lumbosacral spine as a result of injury”. He also agreed that there was pre-existing pathology in both areas, which probably pre-dated the injury at work. However, there was also MRI scan and clinical evidence of probable rotator cuff pathology in the right shoulder as a result of the fall. Though Dr Bodel found Mr Livaja’s level of complaint difficult to understand in terms of the pathology seen, there was genuine evidence of pathology in the neck, back and right shoulder due to the work injury. In terms of fitness for work, Dr Bodel merely observed that the worker’s earning capacity was impaired and that he had a poor command of English, which would complicate the chances of him returning to work.
Dr Bodel assessed Mr Livaja to have a 6 per cent whole person impairment as a result of the condition of his cervical spine, a 5 per cent whole person impairment as a result of the condition of his lumbar spine (both assessments arrived at after allowing a 10 per cent reduction for pre-existing pathology), and an 8 per cent whole person impairment as a result of restricted range of right shoulder movement with associated pathology in the right shoulder. Combined, those impairments equated to a whole person impairment of 18 per cent.
In a supplementary report dated 13 February 2008, Dr Bodel commented on a report from Dr Burke, specialist qualified on behalf of the employer’s insurer, Employers Mutual NSW Limited, dated 11 December 2006, which assessed Mr Livaja to have DRE cervical and lumbar Category II ratings, which he totally discounted for pre-existing pathology to find a nil whole person impairment for the injury under review. Dr Bodel also reviewed other reports relied upon by Superior Formwork, including reports from Dr Rowe dated 19 January 2007, Dr Mills dated 23 August 2005, Dr Keighery dated 19 May 2005, together with Dr Harrison’s MAC of 11 April 2007. None of the additional documents caused Dr Bodel to alter his previous assessment.
Superior Formwork’s medical evidence
Dr Keighery, general practitioner and WorkCover accredited injury management consultant, examined Mr Livaja at the request of Employers Mutual on 10 May 2005 and reported to the insurer on 19 May 2005. Although Mr Livaja claimed to be a “very sick person”, the doctor found no “obvious residual injury from his fall”. The doctor advised Mr Livaja that he was exaggerating his symptoms and that he would speak with Dr Tomasevic. Dr Tomasevic told Dr Keighery that he would place Mr Livaja on a work conditioning programme, but refused to certify him fit for work five hours a day five days a week.
Dr Keighery provided a supplementary report on 15 October 2005 in which he referred to a telephone call from a person at Employers Mutual and stated that, having read a report from Dr Mills (in evidence before the Arbitrator but not in evidence on appeal because of the operation of clause 43 of the Regulation), he agreed with Dr Mills that Mr Livaja was no longer incapacitated for work.
Dr Burke, surgeon, examined Mr Livaja at the request of Superior Formwork’s solicitors on 11 December 2006 and prepared three reports on that date. In his first report, Dr Burke noted the worker to be a tall, thin and pale man who appeared to be depressed. He walked with a very slow shuffle and spoke in a monotone. The physical examination was marked by very restricted movement. There was no cervical movement during formal examination, however, in the prone position cervical extension was at least two thirds. At other times during examination, the doctor saw Mr Livaja flex his neck by at least two thirds. When asked to flex forward, Mr Livaja leaned forward at the hips by perhaps two or three degrees. Extension, lateral flexion and rotation of the back were nil. Mr Livaja adopted the prone position in a slow and awkward fashion. In the course of doing so he arched his back, adjusted the pillow, and carried out other movements that were not demonstrated during the formal examination. Lumbar extension was at least two thirds of normal and rotation was at least half of normal as he awkwardly turned to the supine position. Straight leg raising was about two degrees on each side. Mr Livaja refused to sit with his legs extended. However, when sitting on the edge of the examination couch, he tended to keep his legs partly extended, making it difficult to assess lower limb reflexes. In respect of the right shoulder, abduction and flexion were demonstrated to 90 degrees. Right sided extension was nil during the formal part of the examination, but at least 45 degrees in the prone position. Though he had earlier demonstrated abduction and flexion to 90 degrees, Mr Livaja then indicated that he was not able to abduct his right shoulder by more than 50 degrees in order to demonstrate internal and external rotation.
Dr Burke made the following diagnoses:
(a) longstanding underlying multi-level degenerative change in the lumbar region, especially at the L4/5 level, but no evidence of thecal or nerve root embarrassment;
(b) underlying degenerative change in the lower cervical region, but with no evidence of thecal or nerve root embarrassment;
(c) contusion and strain to the right lumbar area, the right elbow and the right shoulder, as well as aggravation of underlying degenerative change in the cervical and lumbar areas, caused by his fall at work, and
(d) apparent depression.
Under “Attributability”, Dr Burke stated that it was likely that any strain or aggravation caused by the fall at work would have resolved completely within eight to 12 weeks of the fall. Dr Burke felt that any current symptoms appeared to be due to underlying degenerative changes and that the injuries caused in the fall had resolved. He did not think any treatment was indicated in respect of the accident in question.
Under “Consistency”, Dr Burke noted that some of the worker’s symptoms were difficult to explain in rational anatomical terms, there were no corroborating physical or radiological signs in many respects, many movements varied between formal and informal examination, and the unaltered persistence of symptoms could not be explained in rational physiological terms. He felt that the underlying degenerative spondylitis would progress with age. In view of the underlying degenerative changes in his spine, Mr Livaja should be advised to avoid repeated bending and lifting and manoeuvring of heavy objects. He was unfit for work as a formwork carpenter, but fit for a wide variety of lighter chores. Any aggravation caused by the fall in March 2005 had ceased, and probably did so within 12 weeks of that date.
Dr Burke’s second report of 11 December 2006 is four pages in length and is date stamped “received 18 DEC 2006”. In this report, Dr Burke assessed Mr Livaja to have a 5 per cent whole person impairment as a result of the condition of his cervical spine with no deduction in respect of the pre-existing condition of his neck. The doctor said he was prepared to review his comments in the light of any medical reports that might reflect on the condition of Mr Livaja’s neck prior to the work injury. He felt that the neck condition did not adversely affect Mr Livaja’s capacity for work. Dr Burke assessed the whole person impairment as a result of the condition of Mr Livaja’s lumbar spine to be 6 per cent. He expressly noted that the condition of the worker’s spine restricted his capacity for work. As Mr Livaja denied any previous back symptoms, the doctor made no deduction for the underlying degenerative changes. In view of the variable movements of the right shoulder, he assessed nil rateable impairment of the right upper limb.
Dr Burke’s third report of 11 December 2006 is date stamped “11 JAN 2007”. In this report, the doctor confirmed his previous impairments for the cervical spine and lumbar spine, but because any current symptoms were due to underlying and progressive degenerative change, he applied a 100 per cent deduction leaving nil impairment due to the subject accident.
Other expert reports
Dr Ting, occupational therapist and vocational assessor, conducted a vocational and functional assessment of Mr Livaja on 8 December 2008 and reported on 9 December 2008. He recorded that Mr Livaja completed the equivalent of year eight in Bosnia in 1972 and that he left school at the age of 15 years.
After conducting an extensive functional capacity evaluation, Dr Ting concluded that Mr Livaja did not demonstrate a physical capacity to perform his pre-injury duties, but he was able to perform sedentary work for four hours per day five days a week in “highly selective work environments” (page 13). He felt that Mr Livaja should avoid tasks that require:
(a) repetitive movements of the head;
(b) rapid changes of body posture;
(c) repetitive right upper limb work (repetitive reaching to above shoulder level, repetitive gripping and handling and placing more than one kilogram);
(d) carrying more than three kilograms;
(e) climbing ladders/stairs;
(f) walking on uneven surfaces;
(g) multi-limb tasks;
(h) prolonged sitting, standing or walking;
(i) repetitive bending;
(j) repetitive lifting;
(k) lifting from floor level;
(l) prolonged work in one position for more than 30 minutes, and
(m) jerking, jolting and jarring of the spine.
Vocational tests conducted by Dr Ting revealed that Mr Livaja’s verbal skills were not sufficient for employment in an English-speaking environment. He was not likely to be suitable for the most basic clerical tasks.
Considering Mr Livaja’s transferable skills and functional capabilities, Dr Ting felt that suitable part-time positions might include work as a light-product assembler and container filler. Such work would require a sympathetic work environment to accommodate his restrictions and limitations. Dr Ting thought the worker’s earning potential was $68.80 per week. He arrived at this figure by averaging the wage for a light product assembler ($541.10 per week) and a container-filler ($767.00 per week) for 20 hours per week but allowing only a 20 per cent chance of gaining that employment.
Superior Formwork relies on several reports from ARC Work Assessment Centre (‘ARC’) conducted on 29 November 2006, including a vocational assessment, a section 40 assessment, and a functional capacity evaluation assessment.
Mr Livaja’s performance at the functional capacity evaluation was assessed as being “uncooperative and inconsistent”. He self limited his performance in the majority of test items and there were clear signs of inconsistency in his physical presentation. Those inconsistencies suggested exaggeration and supported the view that behavioural factors contributed more to his displayed limitations. Nevertheless, based on his demonstrated ability it was considered that Mr Livaja had the capacity to perform a range of work in the sedentary and semi-sedentary work categories. However, his ability to perform light manual handling work could not be determined because of his self-limited performance. Due to the physical signs noted and the presence of disc pathology, he was not recommended for heavy manual work. However, he was capable of work of a sedentary nature without restriction and in a full-time capacity.
The vocational assessment consisted of an interview conducted by Ms Atteya, rehabilitation counsellor with ARC. Ms Atteya noted Mr Livaja’s background, his basic secondary school education, his limited work experience overseas as a production worker, and that he had been able to obtain work in Australia by using his contacts amongst the Bosnian community to obtain work as an unskilled formwork labourer. It was noted that Mr Livaja has limited transferable skills and that, based on his pain focus and presentation, he was not considered a suitable candidate for training. Mr Livaja was assessed to be suitable for work as a product packager, process worker, and/or product assembler. Mr Livaja was not motivated to try to return to work and, whilst that remained the case, a successful outcome was highly unlikely.
The section 40 assessment includes a summary of award and labour market rates of pay applicable for the jobs identified as being suitable for Mr Livaja. In respect of product packagers, the award is the Warehouse Employees’ General State Awards where the appropriate rate is $528.70 per week full-time. The market rate varies between $18.00 and $27.00 per hour ($684.00 to $1,026.00 per week for a 38-hour week). The report referred to one employer (Kelly Services Pty Ltd) paying approximately $1,310.00 per week but that figure included an unidentified period of overtime and loadings for Saturday and Sunday shifts. Whilst product packaging was a fairly large occupation, employment prospect for packers were “limited”. The award rate for assemblers was $521.10 per week with the market rate said to range between $16.00 and $18.00 per hour ($608.00 to $684.00 per week for a 38-hour week). The award rate for process workers was also $521.10 per week with a market rate between $15.00 and $16.00 per hour ($570.00 to $608.00 per week for a 38-hour week). Job prospects for both assemblers and process workers were described as “limited”.
THE ARBITRATOR’S REASONS
After setting out a brief history of the matter and identifying the issues in dispute, the Arbitrator made the following findings:
(a) the worker had not demonstrated that the Appeal Panel’s decision was based on irrelevant, prejudicial or inadmissible material resulting in a serious breach of procedural fairness or injustice so as to warrant a referral to an AMS under section 329 of the 1998 Act (Reasons at [16]);
(b) because the opinions of Dr Bodel were based on such a significantly different factual foundation, the worker was entitled to have any impairment resulting from the condition of his cervical spine assessed again (Reasons at [19]);
(c) on the basis of the objective findings in the MRI scan of the lumbar spine, the Appeal Panel determined that the AMS had erred in his assessment of the worker’s lumbar spine. The MRI scan of the cervical spine showed disc bulging at the C4/5 and C5/6 with some impingement on the cord at C4/5. Though the AMS referred to the MRI scan at page two of the MAC, he did not otherwise comment on it. The Appeal Panel did not explain why the AMS was not in error in respect of his assessment of the cervical spine, as he was in respect of his assessment of the lumbar spine. The Appeal Panel did not assess whether the AMS erred in dismissing the objective signs of restriction and limitation in the neck on the basis of the abnormal illness behaviour and did not otherwise indicate its view on the AMS’s findings (Reasons at [19]);
(d) the condition identified by the AMS, which led him to dismiss objective and clinical findings in respect of the neck, was a condition capable of change and, by the time Mr Livaja was assessed by Dr Bodel, that condition of abnormal illness behaviour had in fact changed (Reasons at [20]);
(e) given the evidence from Drs Bodel and Matalani since the Appeal Panel’s decision, there was nothing in the legislation to prevent Mr Livaja from having a fresh assessment of the cervical spine. The legislation does not prescribe what must be provided in support of a fresh claim, but as a matter of practice and common sense, it is clear there must at least be evidence of a higher assessment to support a fresh claim of permanent impairment. That exists in the present case (Reasons at [22]);
(f) the MAC issued by Dr Harrison on 11 April 2007 was only conclusively presumed to be correct as to the degree of permanent impairment of the cervical spine as at the date it was issued. The degree of permanent impairment may alter after an assessment by an AMS. It is not a “static circumstance” simply because it is said to be “permanent” (Prisk v Department of Ageing, Disability and Home Care (No 2) [2009] NSWWCCPD 13 (‘Prisk’)). Therefore, a MAC is only conclusively presumed to be correct in respect of section 326 matters at a particular point in time, namely the date of assessment, and in respect of a particular injury. Prisk suggests that a MAC that results from a referral for assessment by an AMS within particular proceedings is relevant to, or concerned with, only those proceedings (Reasons at [23]);
(g) in respect of the right shoulder, the medical evidence was persuasive that Mr Livaja continues to suffer from the effects of his injury (Reasons at [30]);
(h) an arbitrator has no jurisdiction to make negative findings in respect of permanent impairment such as would bind an AMS or prevent referral to an AMS (Haroun v Rail Corporation New South Wales & ors [2008] NSWCA 192 (‘Haroun’));
(i) Mr Livaja was restricted in the manner identified by Dr Matalani and with his restricted English skills would find it difficult to find sedentary work (Reasons at [38]);
(j) Dr Ting correctly identified the limitations Mr Livaja would face in returning to work (Reasons at [39]);
(k) Mr Livaja was unfit for his pre-injury duties and had been partially incapacitated for work since 14 November 2005 and continuing (Reasons at [41]);
(l) applying the steps in Mitchell v Central West Area Health Service [1997] 14 NSWCCR 526 (‘Mitchell’), the Arbitrator noted that probable earnings but for injury were agreed to range between $1,300.00 per week from 30 June 2006 to $1,450.00 per week to 30 June 2009 and she determined that Mr Livaja’s ability to earn in some suitable employment for 20 hours per week was no more than $360.00 per week (Reasons at [48] and [49]);
(m) Mr Livaja was entitled to an award at the maximum statutory rate for a worker with no dependants from 14 November 2005 to date and continuing, and
(n) Superior Formwork was liable to pay Mr Livaja’s reasonably necessary section 60 expenses upon production of accounts and/or receipts.
ISSUES IN DISPUTE
The issues in dispute in the appeal are whether the Arbitrator erred in:
(i)In relation to the award of weekly compensation:
(a)failing to have any or any proper regard to the evidence relied upon by the employer, including medical reports, a vocational assessment report and the evidence of the AMS (Dr Harrison) and the Appeal Panel, and
(b)failing to give any or any adequate reasons as to why the evidence relied upon by the employer was not accepted and, in particular, failing to explain why the medical evidence relied upon by the worker was preferred over that relied upon by the employer.
(ii)In relation to the referral of the claim for lump sum compensation in respect of the cervical spine to an AMS:
(a)failing to accept the MAC issued by the Appeal Panel (in the first proceedings) as being conclusively presumed to be correct in the current proceedings;
(b) determining that it was open to her as a matter of law to refer the
matter for assessment by an AMS under section 321 of the 1998 Act, and
(c) determining that the reports of Dr Bodel constituted a change of
circumstances which allowed referral for further assessment by an
AMS when there was no evidence of any such change and, in
particular, no evidence of any deterioration.
(iii)In relation to the finding that the injury to the right shoulder had not resolved and the referral of the claim for lump sum compensation in respect of the right upper extremity to an AMS:
(a) failing to give any or any adequate reasons to support the finding
that the injury to the right shoulder was continuing and, in particular,
failing to provide any or any adequate reasons as to why the
evidence relied upon by the employer was rejected, and
(b) finding that it was not open to her to make a determination as to
whether the injury to the right shoulder was continuing for the
purposes of referral to an AMS.
SUBMISSIONS, DISCUSSION AND FINDINGS
Weekly compensation
Superior Formwork challenges this part of the Arbitrator’s decision on the ground that she made no reference to any of the evidence relied upon by it in disputing the worker’s entitlement to weekly compensation. It is further submitted that it is well established that a tribunal of fact must give reasons as to the factual basis upon which the decision is made and a failure to do so constitutes an error of law (Wiki v Atlantis Relocations (NSW) Pty Ltd (2004) 60 NSWLR 127; Hevi Lift (PNG) Limited v Etherington [2005] NSWCA 42; (2005) 2 DDCR 271; Wall to Wall Civil Australia Pty Limited v Emeli [2008] NSWWCCPD 118 and ING Administration Pty Limited v Singh [2008] NSWWCCPD 48).
Mr Livaja submits that the Arbitrator considered all available medico-legal evidence.
Mr Livaja’s submission is not borne out by the Arbitrator’s Reasons, which make no reference to any of the employer’s evidence. Whilst the Arbitrator clearly indicated her acceptance of the evidence tendered on behalf of Mr Livaja (Reasons at [38], [39], [46]), her failure to refer to the evidence called on behalf of Superior Formwork, or to consider the issues raised by that evidence, involves an error and requires that the award for weekly compensation be re-determined.
Further, as Mr Stockley correctly pointed out at the appeal hearing, the Arbitrator’s statement that Mr Livaja “would be able to earn no more than $360.00” (Reasons at [48]) does not comply with the requirement to make a determination of his ability to earn in the terms of section 40(2)(b) of the 1987 Act (Mitchell at 533B). As the Court observed (at 532F) in Mitchell, the Arbitrator’s words delineate “the establishment of a ceiling rather than, as the statue required, evaluation of a level of ability”. Whilst the case does raise issues as to Mr Livaja’s credit, as he was not cross-examined at the arbitration, I believe that I am in as good a position as an arbitrator to conduct that redetermination and that is the course I propose to adopt.
Dr Keighery prepared his first report before the MRI scans were performed and the weight to be attached to it is therefore considerably diminished. In any event, Dr Keighery provided no diagnosis but merely concluded that there was no obvious residual injury from the fall and that Mr Livaja was exaggerating his symptoms. He initially felt that Mr Livaja was fit for unidentified duties for five hours a day five days a week, but subsequently concluded, after reading Dr Mills’ report and after a telephone conversation with a person from Employers Mutual, that he agreed with Dr Mills that there was no incapacity for work. Reaching such a conclusion in the absence of a further examination further undermines Dr Keighery’s evidence and I do not accept it.
The remainder of the employer’s medical case is based on evidence from Dr Burke to the effect that Mr Livaja’s pathology consists of “underlying degenerative changes in the spine” and that the injuries caused by the fall at work had resolved.
Whilst I accept that Mr Livaja exaggerated his presentation to several medical practitioners who have examined him for the purposes of the present claim, that does not override the significance of the objective evidence referred to in the MRI scans and the fact that Mr Livaja had no symptoms in his back, neck or right shoulder before his work accident. The Appeal Panel placed great weight on the findings in the MRI scan of the lumbar spine and assessed Mr Livaja to have a 5 per cent whole person impairment as a result of his low back injury. Superior Formwork has properly conceded Mr Livaja’s entitlement to lump sum compensation in respect of that impairment. Dr Burke’s conclusions cannot sit with this evidence, which involves a concession that the effect of the injury is continuing.
Dr Burke’s evidence is also undermined because of the change in his opinion between the two reports date stamped 18 December 2006 and 11 January 2007. In the first report, Dr Burke correctly noted that, on the evidence, Mr Livaja’s neck and back symptoms had only been present since the work injury and, therefore, no deduction was possible in respect of the pre-existing condition of his neck or back. He therefore assessed (in the body of the report) a 5 per cent whole person impairment in respect of the cervical spine and a 6 per cent whole person impairment in respect of the lumbar spine. Given these assessments and given that Mr Livaja was asymptomatic before the work accident, it follows that Dr Burke’s opinion in his main report (that the effect of the injury ceased after 12 weeks) cannot stand.
Dr Burke tried to overcome this problem in the report stamped 11 January 2007 where he reversed his previous opinion and concluded that Mr Livaja’s symptoms were wholly due to underlying and progressive degenerative changes. Without a proper explanation of his change in opinion, I place little weight on Dr Burke’s conclusions.
Leaving aside the doctor’s inadequately explained change of opinion, and how that might have come about, I do not accept the conclusions he expressed in his main report or in his report date stamped 11 January 2007. His conclusions are inconsistent with Mr Livaja’s evidence, which I accept, that he was symptom free in his neck, back and right shoulder prior to his accident on 7 March 2005 and that he performed all of the duties required of a formwork labourer without restriction for several years up to that date.
I also accept Mr Livaja’s evidence that the symptoms in his neck, back and right shoulder have continued since the fall. This conclusion is reinforced when one considers his evidence that he also injured his right elbow in the fall and that those symptoms have resolved. This provides a sound basis for accepting his evidence that his other symptoms have not recovered. In these circumstances, I reject Dr Burke’s conclusion that the effect of the fall resolved within 12 weeks of 7 March 2005.
Dr Bodel’s evidence is logical, rational, and consistent with the objective findings in the MRI scans and with Mr Livaja’s evidence that he had no symptoms prior to 7 March 2005. At the same time, Dr Bodel acknowledged that Mr Livaja’s level of complaint was difficult to understand, but that does not mean that he did not suffer the injuries alleged or that the effect of those injuries has ceased. For these reasons (and the reasons below at [117] to [122]) I prefer and accept Dr Bodel’s evidence that as a result of the injury on 7 March 2005 Mr Livaja has ongoing pathology in the nature of disc pathology in his cervical spine and in his lumbo-sacral spine and suffered a rotator cuff injury to his right shoulder. I also accept Dr Bodel’s evidence that, as a result of his injuries and the resulting pathology, Mr Livaja’s earning capacity is impaired. However, given Mr Livaja’s inconsistent and exaggerated presentation to the medical experts, I do not accept that it is impaired to the extent he claims.
Mr Livaja’s exaggeration continued in his presentation to Ms Farag, occupational physiotherapist who conducted the functional capacity evaluation for ARC on 29 November 2006. Notwithstanding that exaggeration, I am comfortably satisfied that, having regard to the pathology referred to by Dr Bodel, Mr Livaja is unfit for his pre-injury work as a formwork labourer. That work clearly requires heavy lifting of the kind Mr Livaja is now unfit to perform as a result of his work injury.
However, having regard to Mr Livaja’s exaggeration, I do not accept that he is as restricted as Dr Ting has assessed. In particular, I do not accept that he is only capable of working 20 hours per week. I believe that Mr Livaja is fit for work that does not involve heavy or repetitive lifting, repetitive bending, or prolonged standing and that he is fit for full-time work as a product packager, assembler or process worker, as assessed by Ms Atteya. The salary range for these occupations is quite large (see [63] above), ranging from the award rate of $521.10 per week to the highest market rate of $1,310.00 per week with Saturday and Sunday loadings with Kelly Services Pty Ltd.
The assessment of Mr Livaja’s ability to earn must take into account the matters in section 43A of the 1987 Act. Those matters include the nature of Mr Livaja’s incapacity and pre-injury employment (dealt with above), his age (53), his level of education, skills and experience (schooling to year eight, with only unskilled work since), the medical evidence (reviewed above), the absence of rehabilitation, and his limited command of English. Taking these matters into account, I do not accept that Mr Livaja would be able to obtain and retain employment as a product packager earning $1,310.00 per week.
Whilst I do not accept all of the restrictions suggested by Dr Ting, I do not accept that Mr Livaja is fit for the kind of extended overtime necessary for him to earn significantly above the award rates for process workers or assemblers. I therefore assess Mr Livaja’s ability to earn in the labour market accessible to him to be $570.00 per week as a full-time process worker or assembler. In arriving at this rate, I have allowed the market rate of $15.00 per hour for a 38-hour per week (Ms Atteya’s section 40 assessment report at page two). Allowing an adjustment of that amount at 3% per annum each financial year from November 2006 up to June 2009 (as the parties have agreed is the appropriate adjustment for probable earning but for the injury) gives $587.10 for the year ending 30 June 2007, $604.71 for the year ending 30 June 2008 and $622.85 for the year ending 30 June 2009.
Deducting these figures from the agreed probable earnings but for injury ($1,300.00 per week in June 2006 adjusted by $50.00 per week each financial year thereafter up to 30 June 2009) gives a difference that exceeds the maximum statutory rate of compensation payable to a worker with no dependants.
The employer argues that this is an appropriate case for the exercise of the discretion in section 40(1) of the 1987 Act on the basis that Mr Livaja has “exaggerated the nature and extent of his symptoms, if any, is not motivated to seek suitable employment and appears to have made no effort to do so”. There is no evidence that Mr Livaja has sought suitable employment and I infer from the fact that he remains on a disability pension that he has not done so. However, that fact is not a relevant factor to take into account in the exercise of the section 40 discretion (Mitchell). If a worker with an accepted partial incapacity chooses not to use that incapacity, there is no detriment or disadvantage to the employer. His ability to earn remains the same whether he seeks the relevant employment or not.
No other factors have been advanced as to why the section 40 discretion should be used in the present case and I decline to reduce the difference between Mr Livaja’s probable earnings and his ability to earn. To the extent that Superior Formwork argued that Mr Livaja has exaggerated the level of his symptoms and restrictions, I have taken that into account in assessing his ability to earn (see [78] and [79] above).
It follows, for the reasons given in this decision, that I confirm the Arbitrator’s ultimate order for the payment of weekly compensation from 14 November 2005 to date and continuing.
Referral of the assessment of the cervical spine to an AMS
Mr Wardell submitted that the Arbitrator erred in analysing and reviewing the Appeal Panel MAC for error. I agree. The Arbitrator appears to have conducted a merits review of the Appeal Panel MAC (see [64(c)] above). Except when sitting as a member of an Appeal Panel (section 328 of the 1998 Act) and in certain limited circumstances involving section 329 applications (for example, an alleged denial of procedural fairness), an Arbitrator has no jurisdiction to analyse the merits or otherwise of reasons given by an Appeal Panel or an AMS.
Mr Wardell also submitted that the Arbitrator had no jurisdiction to refer the assessment of Mr Livaja’s cervical spine to another AMS. He argued that the Appeal Panel MAC issued in the first proceedings on 20 September 2007 is conclusively presumed to be correct and, as a result, there is no “medical dispute” in existence and there are no “circumstances” that warrant or allow a departure from the legally binding effect of the MAC. It is further argued that the Arbitrator erred in relying on Prisk as authority for the proposition that “a MAC that results from a referral for assessment by an AMS within particular proceedings is relevant to, or concerned with, only those proceedings” (Reasons at [23]).
The status of a MAC is dealt with in section 326 of the 1998 Act. So far as is relevant, section 326(1) provides:
“(1) An assessment certified in a medical assessment certificate pursuant to a medical assessment under this Part is conclusively presumed to be correct as to the following matters in any proceedings before a court or the Commission with which the certificate is concerned…”
The employer argued that it would have been a simple matter for the legislature to make it clear that a MAC is conclusively presumed to be correct only in the proceedings in which the referral was made. It should be inferred, so it is argued, that the intention of Parliament in using words that are more general was to avoid or thwart the very outcome that the worker seeks to achieve in the present proceedings, namely obtaining repeated MACs and discontinuing proceedings until a MAC that meets the approval of the worker is obtained. This, it is argued, is contrary to the objectives of the legislation and patently unfair to employers.
Reference is made to the Court of Appeal decision in JC Equipment Hire Pty Limited v The Registrar of the Workers Compensation Commission of NSW [2008] NSWCA 43, (2008) 5 DDCR 403 (‘JC Equipment Hire’) in which Tobias JA said (at [38] and [39]):
“38. …a medical assessment certificate pursuant to an assessment under Pt 7 of Ch 7 is only conclusively presumed to be correct in any proceedings before a court or the Commission with which the certificate is concerned. Where such a certificate is given with respect to proceedings in the Commission for the determination of lump sum compensation under s 66, it cannot be conclusively presumed to be correct with respect to proceedings for work injury damages in the District Court as the proceedings are clearly different.
39. However, it is to be noted that the effect of s 326(1) is that a medical assessment certificate issued pursuant to a medical assessment under Pt 7 of Ch 7 is only conclusively presumed to be correct with respect to the proceedings for the purpose of which the certificate has been obtained, namely, for the purpose of a lump sum compensation claim on the one hand or a work injury damages claim on the other. As such, the acceptance by the person on whom a claim for lump sum compensation under s 66 is made that the degree of permanent impairment is a particular percentage figure should not, unless the text of the statute so requires, be conclusively binding upon that person in respect of a claim for work injury damages.”
Mr Wardell submitted that the facts in Prisk are quite different to the facts in the present case. It concerned a claim for further hearing loss some years after the original claim had been determined by the Compensation Court after a contested hearing. It involved not just the effect of earlier binding Medical Panel certificates, but also questions of estoppel arising from earlier decisions by the Compensation Court between the same parties. In that claim, the earlier medical certificates had been obtained for the purpose of different proceedings for lump sum compensation in respect of a different injury (at [62]). The employer also refers to the following statements at [65] and [66] of Prisk:
“65. I do not accept the Department’s submission that it would be ‘perverse’ if the previous Medical Panels, the Terms of Settlement and the decision of Curtis CCJ did not bind Mr Prisk. The Terms of Settlement do bind Mr Prisk in that he cannot recover compensation in respect of the 7.6% binaural hearing loss for which he has already been compensated. It is correct, however, that the Department was entitled to argue, as it did argue before the Arbitrator, that Mr Prisk had not sustained any further injury. That argument, rejected by the Arbitrator, was put on the ground that Mr Prisk’s employment at the time of the notice of injury was not employment to the nature of which the injury was due.
66. I do not accept that a party who is dissatisfied with the outcome from an AMS referral would be entitled to re-lodge an application the ‘next day’, as claimed by the Department. Any claim for compensation on the basis of a further loss of hearing must satisfy the requirements of section 17 of the 1987 Act. An application issued without appropriate evidence in support of the relief being claimed would be liable to be dismissed as vexatious or frivolous (see section 354(7A) of the 1998 Act).”
I agree that the facts in Prisk are quite different to those in the present matter. The estoppel issues that arose in Prisk do not arise in the present matter. However, the question that does arise was touched on by Tobias JA in JC Equipment when his Honour said that “a Medical Assessment Certificate issued pursuant to a medical assessment under Part 7 of Chapter 7 is only conclusively presumed to be correct with respect to the proceedings for the purpose of which the certificate has been obtained” (at [39]) (emphasis added).
The Appeal Panel issued a MAC in proceedings number 16951 of 2006, the first proceedings. Those proceedings did not proceed to determination by the Commission because Mr Livaja elected to discontinue his claim on 12 December 2007. Whilst the Consent Orders of that date refer to leave having been granted for him to discontinue, leave was not required (see Part 15 Rule 15.7 Workers Compensation Commission Rules 2006). It is clear beyond doubt therefore that the Appeal Panel MAC was obtained in the first proceedings. They were the proceedings with which the MAC was “concerned”. Once those proceedings were discontinued it is difficult to see how the MAC could be conclusively presumed to be correct with respect to later proceedings, even when those proceedings are between the same parties and relate to the same injury.
The employer’s argument has wrongly assumed that the mere issuing of a MAC resolves the issues in dispute and that a MAC issued in one set of proceedings therefore binds the parties in subsequent proceedings. Whilst a properly constituted and issued MAC is conclusively presumed to be correct in any proceedings with which the certificate is concerned, a MAC does not determine the parties’ rights (Joppa Pty Ltd t/as Tricia’s Clip-n-Snip v Edenden [2004] NSWWCCPD 50; (2004) 5 DDRC 321). A dispute is not determined unless and until the Commission determines liability and issues a Certificate of Determination.
A MAC issued in earlier proceedings does not bind the parties in later proceedings unless the Commission has determined the issues in dispute in the earlier proceeding. Nor does it create an estoppel that is binding in later proceedings between the same parties. Had the first proceedings concluded with a determination by the Commission based on the terms of the Appeal Panel MAC, then, in the absence of a successful reconsideration application under section 350(3) of the 1998 Act, Mr Livaja would have had little prospect of avoiding the effect of that determination. However, in the absence of a determination in the first proceedings there is no reason in logic or in law why the Appeal Panel MAC is conclusively presumed to be correct in subsequent proceedings with which it was not concerned.
Mr Wardell urged that the use of the word “any” before “proceedings” indicates that the legislature intended that a MAC is to be conclusively presumed to be correct in any proceedings between the same parties relating to the same medical dispute over lump sum compensation. I do not agree. The word “any” merely acknowledges, as Mr Stockley submitted, that there might be other proceedings on foot in another jurisdiction with which the certificate “is concerned”. The reference to “proceedings before a court or the Commission” confirms that fact. That there may be other proceedings “with which the certificate is concerned” is also confirmed by section 245 of the 1987 Act which provides that the Industrial Relations Commission may refer to an AMS any dispute as to a worker’s condition or fitness for employment.
Mr Stockley submits, and I agree, that the word “certificate” qualifies “proceedings” in that it is the proceedings that give rise to the certificate. The first proceedings gave rise to the Appeal Panel MAC. Without those proceedings, neither the AMS nor the Appeal Panel would have issued any certificate. Therefore, the first proceedings are the proceedings “with which the certificate [the Appeal Panel MAC] is concerned”.
The fallacy of the employer’s argument is well illustrated if the roles are reversed. Say a worker obtained a favourable MAC in the first proceedings, but, because he or she wished to undergo further investigations in the hope of obtaining a higher assessment, decided to discontinue those proceedings before the Commission determined the dispute by issuing a Certificate of Determination. If, as a result of the investigations, the worker’s whole person impairment were then assessed to be substantially lower, would the worker, in subsequent proceedings, be entitled to rely on the MAC issued in the discontinued proceedings? The answer is clearly ‘no’. Because the worker discontinued the first proceedings before any binding determination by the Commission, the medical dispute would remain on foot and be referred to a second AMS for assessment in the second proceedings, having regard to the evidence tendered at that time. The MAC issued by the second AMS would (subject to any appeal under section 327) be conclusively presumed to be correct in the proceedings with which it is concerned, namely the proceedings in which it is issued.
If the Commission has determined the issues in dispute, an estoppel may arise that will bind the parties in the later proceedings. No estoppel arises in the present matter because Mr Livaja discontinued the first proceedings. However, the employer’s argument seeks to elevate the Appeal Panel MAC in the first proceedings to the level of an estoppel. If no Certificate of Determination is issued (because the worker has discontinued the proceedings), the MAC in the first proceedings may be tendered as evidence in subsequent proceedings (as it was in the current proceedings), but is not conclusively presumed to be correct in those proceedings because they are not the proceedings “with which the certificate is concerned”.
Mr Wardell submitted there are important reasons of public policy why the MAC in the first proceedings should be held to be conclusively presumed to be correct in the current proceedings, namely that litigation should not proceed indefinitely and that section 326 is designed to prevent forum shopping of the kind demonstrated in this matter. If the worker’s approach is correct, then, so it is argued, if a worker is dissatisfied with a MAC he or she will merely discontinue and commence fresh proceedings. Such an approach would defeat the purpose of the legislation.
I do not accept that submission.
First, a worker who discontinued and then re-issued seeking the same relief based on the same evidence may be met with an application that the second proceedings be dismissed as frivolous or vexatious or lacking in substance (section 354(7A)). Mr Livaja has not re-issued on the basis of the same evidence.
Second, a worker who discontinued proceedings would not be entitled to costs for those proceedings. That provides a strong disincentive to adopting the course adopted in the present matter.
Third, a worker’s medical condition is capable of change. It is now more than two years since the Appeal Panel MAC. As a matter of basic fairness there is no reason why a MAC that is two years old should now bind a worker, especially in circumstances where he has issued fresh proceedings suggesting, based on different evidence, his impairment is different to that assessed two years earlier.
Last, the relief sought in the current proceedings will merely result in the assessment of the whole person impairment resulting from the cervical spine injury being referred to an AMS for assessment. The assessment method requires the application of criteria in the American Medical Association, fifth edition, Guides to the Evaluation of Permanent Impairment, and the WorkCover Guide to Evaluation of Permanent Impairment. The method of assessment of whole person impairment is an objective one. The second AMS will assess the worker using the same objective criteria used by the Appeal Panel in the first proceedings. There is every possibility that the result will be the same or similar to that reached by the Appeal Panel. Thus, there is no injustice or unfairness to the employer. Rather than making a “mockery of the legislative scheme”, as the employer argues, it provides a fair and just application of the medical assessment process. An independent medical expert will assess the current claim in accordance with objective criteria. The result urged by the employer, however, would potentially result in an injustice to Mr Livaja because he would be bound by an assessment issued over two years ago in circumstances where the current medical evidence suggests that the earlier assessment was erroneous.
Mr Wardell submitted that the general structure of Chapter 7 of the 1998 Act supports the interpretation he urges. A “medical dispute” is defined in section 319 and includes a dispute as to the degree of whole person impairment as a result of an injury. Once a validly issued MAC has determined that dispute then, it is argued, it is conclusive in any proceedings with which that dispute is concerned.
I do not accept that submission because section 326 is not expressed in those terms. A MAC is not conclusively presumed to be correct in relation to the particular matter in dispute in isolation of the proceedings with which it is concerned. It is conclusively presumed to be correct as to certain issues, but only in relation to any proceedings with which the certificate is concerned, whether those proceedings are in the Commission or in a court. The question is with which proceedings is the certificate “concerned”. Not, with which dispute is the certificate concerned? In the present case, that question is capable of only one answer. The Appeal Panel MAC was issued in and “concerned” with the first proceedings and it is therefore not conclusively presumed to be correct in the current proceedings.
Mr Wardell referred to Haroun and the discussion in that case about the role played by AMSs in resolving medical disputes. In that case, the worker’s claim for lump sum compensation was, by consent, referred to an AMS for assessment. The consent findings included a reference to the work accidents and stated that the “effects of those injuries continue to contribute to any impairment suffered by the applicant”. It was common ground that the matters referred were medical disputes within section 319 of the 1998 Act. The AMS found, among other things, a whole person impairment of 2 per cent and 4 per cent as a result of the condition of the worker’s left and right lower extremities respectively, but, applying section 323 of the 1998 Act, reduced the compensable loss to nil and issued a MAC to that effect. An Appeal Panel confirmed the AMS’s conclusions.
The worker unsuccessfully sought a judicial review before Associate Justice Harrison on the ground of error of law on the face of the record. The Court of Appeal dismissed the worker’s appeal. Handley A-JA, McColl JA and McDougall J agreeing, held that the Appeal Panel was not only entitled but was bound to treat the consent finding as irrelevant if it came to a different conclusion. His Honour observed (at [16]) that the scheme for the settlement of compensation disputes was to have “factual and legal issues resolved by an Arbitrator subject to appeal to a President or Deputy President, and to have certain medical issues decided by an AMS subject to appeal to a Panel”. His Honour then referred to the fact that a MAC is conclusively presumed to be correct as to the degree of permanent impairment as a result of an injury.
Haroun says nothing about the circumstances before me. It is not disputed that the question of whether Mr Livaja has an entitlement to lump sum compensation as a result of the undisputed injury to his cervical spine must be referred to an AMS for assessment. That is what has happened in the current proceedings.
It follows that I do not accept the employer’s argument that the Arbitrator had no jurisdiction to refer the claim for whole person impairment in respect of the cervical spine to the Registrar, for referral to an AMS for assessment.
In light of the above reasons, it is not necessary to determine if the Arbitrator erred in refusing to refer the matter for a further assessment under section 329 and I express no view on that matter save to note that the terms of section 329 clearly envisage that a matter may be referred to an AMS for assessment again on one or more occasions. Thus, the legislation expressly acknowledges that there will be circumstances where further medical assessments will be necessary.
Referring the claim for impairment of the right shoulder to an AMS
The employer submits that the Arbitrator’s statement that “an arbitrator has no jurisdiction to make negative findings in respect of permanent impairment such as would bind an AMS or prevent referral to an AMS” (Reasons at [32]) constitutes an error of law that is inconsistent with Total Steel of Australia Pty Limited v Waretini [2007] NSWWCCPD 33 (‘Waretini’); Peric v Chul Lee Hyuang Ho Shin Jong Lee and Mi Ran t/as Pure and Delicious Healthy & anor [2009] NSWWCCPD 47 (‘Peric’) and WorkCover NSW v Evans [2009] NSWWCCPD 95 (‘Evans’)).
Mr Wardell submitted that an arbitrator has exclusive jurisdiction to determine issues of injury, including the pathology resulting from an injurious event, liability and causation and those cases clearly establish that this extends to a determination of whether the effects of an injury have resolved in the context of determining a claim for weekly compensation and/or medical expenses. Though it is not necessary for the determination of the present claim, I agree that, consistent with the principles discussed in Waretini, Peric and Evans, the Commission has jurisdiction under section 105 of the 1998 Act to determine issues of injury and causation. Where an arbitrator is required to determine a claim for weekly benefits and/or medical expenses, he or she has a duty to determine whether the effects of an alleged injury are continuing. If it is determined that the effect of the injury has ceased, there is then no medical dispute to be referred to an AMS (Peric) and the worker is estopped from arguing to the contrary in support of the claim for lump sum compensation (Evans).
In any event, the Arbitrator determined that the effects of the injury to Mr Livaja’s right shoulder are continuing (Reasons at [33]). The employer challenges that finding on the ground that the Arbitrator failed to give any or any adequate reasons to support it and, in particular, failed to give any reasons as to why she rejected the employer’s medical evidence, including the clinical findings by Dr Harrison. The employer properly concedes, however, that the Arbitrator’s finding, if sustained on appeal, justifies a referral to an AMS for assessment of whole person impairment because the right shoulder was not referred to the AMS in the first proceedings.
As with the Arbitrator’s approach to the claim for weekly compensation (see [68] above), I agree that she erred in failing to consider the medical evidence tendered on behalf of the employer on this issue and this matter must be re-determined.
In the accident on 7 March 2005, Mr Livaja fell onto his right side and landed “mainly” on his right shoulder (Mr Livaja’s statement 1 February 2008, paragraph 23). He felt immediate pain in his neck, lower back, right shoulder and right elbow. Dr Mattar diagnosed, among other injuries, a right “rotator cuff injury” in his certificate of 10 March 2005. The same parts of the body are listed as having been injured in the worker’s claim form pleaded on 21 March 2005. Mr Livaja’s evidence, which I accept, is that his right elbow symptoms resolved but his other symptoms, including his right shoulder symptoms, have continued. He has consistently complained of pain in his right shoulder and of an inability to lift his arm above shoulder height since his accident. The consistency of those complaints is a significant factor in my assessment of this part of his claim.
Dr Harrison noted Mr Livaja to have a mildly positive right brachial stretch test and a significantly restricted range of movement of his right arm and shoulder. He thought the MRI scan revealed minimal degenerative changes that did not appear to be of clinical significance, notwithstanding the slight osteoarthritic changes in the acromioclavicular joint. Dr Harrison felt that Mr Livaja’s active movement of the right arm at the shoulder was “of a non-organic fashion” which precluded the doctor from validly accepting the range of motion demonstrated “as a pathway to assessing whole person impairment affecting his right upper limb”. After noting that Mr Livaja “impacted on his right shoulder on the hard surface in pain”, Dr Harrison stated that Mr Livaja “has done no frank injury to the right shoulder” (MAC 11 April 2007, page nine). Given the nature of the fall and Mr Livaja’s consistent complaints of shoulder symptoms since, I do not accept Dr Harrison’s statement that Mr Livaja did no injury to his right shoulder.
Dr Burke diagnosed a contusion and strain of the right shoulder and, as with his opinion in respect of the neck and back, he felt that any strain or aggravation would have completely resolved within 12 weeks of the accident. Given Mr Livaja’s consistent complaints of shoulder pain and restriction, albeit exaggerated, and given his evidence that his right elbow symptoms resolved, I accept his evidence that he continues to suffer from symptoms in his right shoulder and I do not accept Dr Burke’s conclusion that any strain or aggravation would have resolved in 12 weeks.
Dr Bodel noted Mr Livaja’s complaint of continuing pain in his right shoulder and recorded a significant loss of range of movement in the shoulder. Whilst he accepted that Mr Livaja’s level of complaint was difficult to understand in terms of the pathology, he concluded that there was “MRI scan evidence and clinical evidence of probable rotator cuff pathology in the right shoulder as a result of the fall”. That opinion, based on a history of the injury and the continuing symptoms since the fall, his findings on examination and the findings in the MRI scan, is logical, consistent and entitled to appropriate weight.
I do not accept the employer’s submission that Dr Bodel did not provide any explanation as to the basis for his diagnosis of a rotator cuff injury. He based his diagnosis on the MRI scan, his history, and his assessment of the clinical evidence at examination. As an orthopaedic surgeon, he was entitled to reach a conclusion based on that examination and history. Given the nature of the injury and Mr Livaja’s consistent complaints of right shoulder symptoms since, I accept Dr Bodel’s conclusion that Mr Livaja suffered a rotator cuff injury to his right shoulder on 7 March 2005 and that the effect of that injury is continuing.
I do not accept the employer’s submission that it may be inferred that Dr Giblin did not consider the right shoulder symptoms to be related to the accident, but rather to degenerative changes. In fact, Dr Giblin thought it was “likely” that the symptoms in Mr Livaja’s arms and shoulder were “referred from his neck” (Dr Giblin 30 March 2006, page three). If that is correct, then, in the alternative, Mr Livaja is entitled to have any whole person impairment resulting from the condition of his right shoulder assessed as it has clearly resulted from the undisputed injury to his neck.
It follows that I reject the employer’s submission that Mr Livaja has failed to discharge the onus of proof regarding the ongoing causal nexus between the accident and his shoulder symptoms. For the above reasons, I confirm the Arbitrator’s order referring the assessment of the degree of permanent impairment as a result of Mr Livaja’s right upper extremity (right shoulder) to the Registrar, for referral to an AMS for assessment.
SUMMARY AND CONCLUSION
Having conducted a review on the merits (per Spigelman CJ in State Transit Authority of New South Wales v Fritzi Chemler [2007] NSWCA 249; (2007) 5 DDCR 287 at [28]), I have concluded that, for the reasons given in this decision, the Arbitrator’s conclusions are true and correct.
DECISION
For the reasons given in this decision, the Arbitrator’s determination of 20 August 2009 is confirmed. The matter is remitted to the Registrar for determination of any outstanding issues.
COSTS
The appellant employer is to pay the respondent worker’s costs of the appeal. Those costs are assessed at $2,200.00 plus GST.
Bill Roche
Deputy President
17 December 2009
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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