Yuvarlak v Western Sydney Area Health Service
[2007] NSWWCCPD 158
•17 July 2007
WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:Yuvarlak v Western Sydney Area Health Service [2007] NSWWCCPD 158
APPELLANT: Susan Yuvarlak
RESPONDENT: Western Sydney Area Health Service
INSURER:Employers Mutual Ltd
FILE NUMBER: WCC3868-06
DATE OF ARBITRATOR’S DECISION: 20 March 2007
DATE OF APPEAL DECISION: 17 July 2007
SUBJECT MATTER OF DECISION: Entitlement to weekly compensation under section 40 of the Workers Compensation Act 1987
PRESIDENTIAL MEMBER: Acting Deputy President Robin Handley
HEARING:On the papers
REPRESENTATION: Appellant: Carters Law Firm
Respondent: Hunt & Hunt Lawyers
ORDERS MADE ON APPEAL: The decision of the Arbitrator dated 20 March 2007 is confirmed.
There is no order as to the costs of this appeal.
BACKGROUND TO THE APPEAL
On 23 March 2007, Susan Yuvarlak sought leave in the Workers Compensation Commission (‘the Commission’) to bring an appeal against the decision of an arbitrator dated 20 March 2007. The Respondent to the appeal is the Western Sydney Area Health Service (‘the Health Service’) whose workers compensation insurer is Employers Mutual Ltd.
The background to this matter is set out in my decision in Yuvarlak v Western Sydney Area Health Service [2007] NSWWCCPD 14, as follows:
“2. Ms Yuvarlak was born in Turkey on 15 July 1958 and is aged 48. She migrated to Australia with her husband in 1987. She is now separated from her husband and has one dependent child living with her who is aged 14. On 3 December 1990, Ms Yuvarlak commenced employment with the Health Service at Westmead Hospital as a full-time cleaner, working 38 hours a week. In September 1995, she transferred to a permanent part-time position as a cleaner, working 16 hours a week over two days.
3. Ms Yuvarlak injured her left wrist in the course of her employment on a number of occasions between 1993 and 2004: there are some discrepancies in the dates but the incidents appear to have occurred on or about 15 November 1993, 27 June 1994, 15 May 1995, 6 October 1997, 11 December 2000, 30 June 2002 and 8 August 2004. Ms Yuvarlak injured her right wrist on 13 October 2002. She was also injured in a number of motor vehicle accidents unrelated to her employment.
4. Ms Yuvarlak made claims for workers compensation in respect of the work-related incidents. In April 2003, she received $3,500 in respect of a 5% permanent loss of efficient use of the left arm below the elbow following settlement of her claim. Ms Yuvarlak last received weekly compensation following the incident on 8 August 2004. By letter dated 14 October 2004, the then workers compensation insurer, Treasury Managed Fund, notified Ms Yuvarlak that it would stop paying weekly compensation and medical, hospital and associated expenses from 15 October 2004 on the basis of medical evidence indicating that her employment was not a substantial contributing factor to her ongoing condition/incapacity.
5. On 14 March 2006, the Commission registered Ms Yuvarlak’s ‘Application to Resolve a Dispute’ in respect of her claim for weekly compensation of $420 per week from 15 October 2004 to date and continuing. The Commission received the Health Service’s ‘Reply’ on 3 April 2006. On 6 April 2006, Ms Yuvarlak filed an amended ‘Application to Resolve a Dispute’. On 23 May 2006, the Arbitrator conducted a teleconference with the parties and, on 15 June 2006, conciliation having proved unsuccessful, she conducted an arbitration hearing...”
In her decision dated 28 June 2006, the Arbitrator (1) made an award for the Health Service in respect of Ms Yuvarlak’s claim for weekly compensation, (2) ordered the Health Service to pay Ms Yuvarlak’s section 60 expenses in respect of her left wrist, and (3) ordered the Health Service to pay Ms Yuvarlak’s costs as agreed or assessed. On 25 July 2006, Ms Yuvarlak appealed against this decision, relying on two principal grounds of appeal: first, that the Arbitrator erred by accepting medical evidence that was mutually exclusive concerning the fracture to Ms Yuvarlak’s left wrist, which the Arbitrator found did not occur in the incident on 15 May 1995; and, second, that the Arbitrator erred by failing to follow the five step process prescribed by the NSW Court of Appeal in Mitchell v Central West Health Service (1997) 14 NSWCCR 527 (‘Mitchell’) in respect of section 40 of the Workers Compensation Act 1987 (‘the 1987 Act’). In the appeal decision dated 17 January 2007, I rejected the first ground of appeal, having found, at paragraph 29:
“In my view, there was clearly sufficient evidence to support the Arbitrator’s finding and I am not satisfied that her discretionary judgement as to the treatment of evidence has miscarried.”
With regard to the second ground, I found, at paragraph 34:
“In my view, the Arbitrator made an error of law by not determining that Ms Yuvarlak’s probable earnings but for the injury were her earnings at the time of the incident on 15 May 1995, but instead proceeding directly to consider her reduced earnings from the time she transferred to part-time employment in September 1995. Ms Yuvarlak’s solicitors provided evidence of her earnings, in the form of fortnightly wage records for the period July 1994 to September 2000, attached to the ‘Application to Resolve a Dispute’. These records indicate that in May 1995 Ms Yuvarlak was earning approximately $500 gross per week. At the arbitration hearing, Ms Yuvarlak’s counsel submitted that it would be reasonable to assume that for the period at issue, from 15 October 2004 to date and continuing, allowing for minimal wage rises over the intervening years, her probable earnings but for the injury would have been about $600 per week. In my view, this is reasonable. Thus, at step one, it would have been reasonable for the Arbitrator to determine probable earnings of $600 per week.”
Ultimately, I set aside the Arbitrator’s award for the Health Service in respect of Ms Yuvarlak’s claim for weekly compensation and remitted the issue of Ms Yuvarlak’s claim for weekly compensation to the Arbitrator for redetermination.
On 2 March 2007, the Arbitrator conducted a teleconference with the parties. On 19 March 2007, conciliation having proved unsuccessful, she conducted an arbitration hearing, at the conclusion of which she gave an oral decision. The Certificate of Determination was issued on 20 March 2007 in the terms set out below.
THE DECISION UNDER REVIEW
The ‘Certificate of Determination’, dated 20 March 2007, records the Arbitrator’s orders as follows:
“1. The Respondent to pay to the Applicant weekly benefits compensation pursuant to section 40 at the rate of $50 per week from 15 October 2004 to date and continuing.
2. The Respondent to pay the Applicant’s costs of the remittal including the arbitration hearing.”
In the statement of reasons for her decision given orally at the conclusion of the hearing, the Arbitrator referred to the NSW Court of Appeal decision in Mitchell. At pages 529 to 530, the Court set out five steps to be followed in respect of determinations under section 40 of the 1987 Act:
“1. To determine the weekly amount the worker would probably have been earning if uninjured (section 40(2)(a))...
2. To determine the average weekly amount that the worker is earning or would be able to earn in some suitable employment from time to time after the injury (section 40(2)(b)). Section 40(3) provides that the determination of this amount is subject to the following:‘(a) the determination is to be based on the worker’s ability to earn in the general labour market reasonably accessible to the worker;
(b) the determination is to be made having regard to suitable employment for the worker within the meaning of section 43A.’ ...
3. To subtract the figure derived from 2. from the figure derived from 1. (section 40(2))
4. To decide whether and to what extent the reduction calculated as above, bears such relation to the amount of that reduction as may appear proper in the circumstances of the case (section 40(1)) ...5. To make an award in the amount arrived at in Step 4.”
Addressing those steps, the Arbitrator said she was satisfied on the evidence that the weekly amount Ms Yuvarlak would have been earning but for the injury to her left wrist as at the time of the injury was $600 (step 1). With regard to step 2, the Arbitrator found that the two days of cleaning work that Ms Yuvarlak was undertaking did not reflect her capacity to earn. The Arbitrator paid particular regard to the report of Dr Richard Honner, Hand Surgeon, dated 1 September 2004, and, noting that Ms Yuvarlak is right hand dominant, said she was satisfied that Ms Yuvarlak could carry out full-time light processing work. While recognising that Ms Yuvarlak has limited transferable skills and limited English, the Arbitrator was, nevertheless, satisfied that Ms Yuvarlak “would be able to earn about $500 per week on the open market reasonably accessible to her within her restrictions”. This gave a Mitchell step 3 figure of $100 per week.
Turning to step 4, the Arbitrator noted that in the report of Dr Maryanne Dawson, Injury Management Consultant, dated 28 September 2004, Dr Dawson said that Ms Yuvarlak did not inform her about the motor vehicle accident on 18 August 2004, but when questioned about it specifically, Ms Yuvarlak told her that the car had been extensively damaged and her left hand was worse after the accident. The Arbitrator said:
“I am of the view that the figure of $100 should be reduced by 50 per cent to take account of the significant motor vehicle accident on 18 August 2004. I note that the assessment carried out by Dr Honner did not take account of the motor vehicle accident because he was not told about it. I note Dr Dawson’s comments in this regard and the applicant’s statement to Dr Dawson that her left hand was worse after the accident.”
The Arbitrator therefore concluded that a figure of $50 per week from 15 October 2004 to date and continuing “was proper in all the circumstances of the case and having regard to all the evidence”. Accordingly, the Arbitrator made an award in these terms (step 5).
ISSUES IN DISPUTE
The grounds of appeal identified by Ms Yuvarlak’s solicitors are that the Arbitrator erred in her determinations as to incapacity arising from the injury and the weekly compensation payable under section 40 of the 1987 Act, in that she made factual findings inconsistent with those in her earlier decision dated 28 June 2006, and misapplied her discretion under section 40 by applying it to an incorrect figure. The parties’ submissions are discussed below.
ON THE PAPERS REVIEW
Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) provides:
“(6)If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”
Having regard to Practice Directions Numbers 1 and 6, the documents that are before me, and the submissions by the parties that the appeal can be determined on the basis of these documents, I am satisfied that I have sufficient information to proceed ‘on the papers’, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances.
Neither party sought to adduce fresh evidence.
LEAVE
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 appeal was lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act. With regard to section 352(2), I am satisfied that the amount of compensation at issue is at least $5,000 and comprises more than 20% of the amount awarded by the Arbitrator. Accordingly, I am satisfied that the section 352 threshold has been met, and I grant leave to appeal.
SUBMISSIONS
Inconsistent factual findings
Ms Yuvarlak’s solicitors submit the Arbitrator erred in finding, pursuant to Mitchell step 2, that Ms Yuvarlak’s ability to earn in some suitable employment post-injury was $500 per week. They contend the Arbitrator should have relied on what she said at paragraph 52 of the statement of reasons for her previous decision: “The general medical consensus, however, is that the Applicant is fit to carry out the cleaning work she has been doing two days a week.” The evidence was that Ms Yuvarlak was earning $245.81 for 16 hours work per week, and her solicitors submit this was the figure the Arbitrator should have relied on as being Ms Yuvarlak’s ability to earn to earn, post injury, in suitable employment. On the basis of pre-injury earnings of $600 per week, this left a shortfall of $354.19, to which the discretion in section 40(1) should be applied. Ms Yuvarlak’s solicitors conceded that a discretionary reduction of up to 50% was appropriate on the evidence.
Ms Yuvarlak’s solicitors submit the Arbitrator was not empowered to revisit her findings in relation to Mitchell step 2 and, even if she was empowered to do so, only on the application of one of the parties properly made on notice with adequate supporting evidence. No such application was made. Ms Yuvarlak’s solicitors submit, in the alternative, that my decision of 17 January 2007 created an issue estoppel as to the step 3 loss of earnings that was not amenable to challenge by either party.
The Health Service states, with regard to the Arbitrator’s findings at Mitchell step 2, that in her original decision “she did not assess the worker’s ability to earn on the open labour market” taking into account Ms Yuvarlak’s work related injuries and the factors specified in section 43A. Upon remitter, the Arbitrator was required to conduct the section 40 assessment anew with the starting point being the worker’s probable earnings but for injury being $600. In her original decision, the Arbitrator found that the worker had voluntarily reduced her work hours to 16 hours a week post injury for reasons unconnected with her injury and that such work was not reflective or indicative of her ability to earn on the open labour market in some suitable employment. Upon remitter, the Arbitrator determined for the first time the worker’s ability to earn post injury. The Health Service submits Ms Yuvarlak’s solicitors have failed to show any factual, legal or discretionary error by the Arbitrator in this regard.
Misapplication of section 40 discretion
Ms Yuvarlak’s solicitors do not dispute the factors taken into account by the Arbitrator in the exercise of her discretion, nor that the deduction of 50% was appropriately made on the available evidence. However, they submit that the Arbitrator should have applied the deduction to the shortfall of $354.19, which they contend I ‘determined’ on appeal, rather than to the $100 shortfall determined by the Arbitrator on the remittal. Ms Yuvarlak’s solicitors submit that my ‘determination’ gives rise to “an issue estoppel” between the parties (Quarmby v Motor Traders Association of NSW Group Apprenticeship Scheme [2005] NSWWCCPD 43, at paragraphs 24 to 26). The application of a 50% deduction to $354.19 would result in a section 40 award for Ms Yuvarlak of $172.60 [sic - $177.08].
The Health Service contends the Arbitrator took into account findings she made in her original decision in exercising her discretion, none of which were disturbed on appeal. Once again, the Health Service submits Ms Yuvarlak’s solicitors have failed to show any factual, legal or discretionary error by the Arbitrator in the exercise of her discretion.
DISCUSSION AND FINDINGS
In my decision dated 17 January 2007, I rejected the first ground of appeal, in relation to the Arbitrator’s treatment of the medical evidence concerning the injury to Ms Yuvarlak’s left wrist, stating, at paragraph 29:
“In my view, there was clearly sufficient evidence to support the Arbitrator’s finding and I am not satisfied that her discretionary judgement as to the treatment of evidence has miscarried. I therefore reject the first ground of appeal.”
With regard to the second ground of appeal, that the Arbitrator erred by failing to follow the five step process prescribed in Mitchell, I found, at paragraph 34:
“In my view, the Arbitrator made an error of law by not determining that Ms Yuvarlak’s probable earnings but for the injury were her earnings at the time of the incident on 15 May 1995, but instead proceeding directly to consider her reduced earnings from the time she transferred to part-time employment in September 1995.”
I stated that in my view, it would have been reasonable for the Arbitrator to determine probable earnings but for the injury of $600 per week. It was the Arbitrator’s error of law in relation to Mitchell step 1 that was the basis for remitting the matter to the Arbitrator for redetermination. At paragraph 35 I stated:
“Proceeding to Mitchell step two, the Arbitrator accepted the evidence that Ms Yuvarlak was capable of undertaking cleaning work for 16 hours a week on a part-time basis. The Arbitrator found Ms Yuvarlak’s earnings for working 16 hours a week in 2004 were $245.81, a figure which does not appear to be in dispute.”
I note that it was Ms Yuvarlak’s actual earnings for 16 hours a week in 2004 that were not in dispute, nor the weekly amount she was able to earn in some suitable employment post-injury. Moreover, the Arbitrator’s acceptance of the evidence that Ms Yuvarlak “was capable of undertaking cleaning work for 16 hours a week on a part-time basis”, was made in the context of the Arbitrator’s finding in relation to step 1 that Ms Yuvarlak’s pre-injury employment was only 16 hours per week. I was not suggesting that this was the correct finding in terms of Ms Yuvarlak’s ability to earn in some suitable employment post-injury. I was merely reciting the Arbitrator’s reasoning, which lead her to conclude that since Ms Yuvarlak’s pre-injury employment was 16 hours a week and she continued to be fit to carry out this work for two days a week post injury, then she had suffered no economic loss as a result of the partial incapacity (statement of reasons, paragraph 55).
My paragraph 35 continued as follows: “Mitchell step three requires that the figure derived from step two be subtracted from the figure derived from step one. This gives a figure of $354.19.” I acknowledge that the second sentence was unhelpful and, in hindsight, my analysis would have been clearer without this.
Ms Yuvarlak’s solicitors submit the Arbitrator was not empowered to revisit her findings in relation to Mitchell step 2 and, even if she was empowered to do so, only on the application of one of the parties properly made on notice with adequate supporting evidence. No such application was made. Ms Yuvarlak’s solicitors submit, in the alternative, that my decision of 17 January 2007 created an issue estoppel as to the step 3 loss of earnings that was not amenable to challenge by either party.
The Health Service contends, with regard to the Arbitrator’s findings at Mitchell step 2, that in her original decision “she did not assess the worker’s ability to earn on the open labour market” taking into account Ms Yuvarlak’s work related injuries and the factors specified in section 43A. Upon remitter, the Arbitrator was required to conduct the section 40 assessment anew with the starting point being the worker’s probable earnings but for injury being $600. The Health Service states that, in her original decision, the Arbitrator found the worker had voluntarily reduced her work hours to 16 hours a week post injury for reasons unconnected with her injury and that such work was not reflective or indicative of her ability to earn on the open labour market in some suitable employment. Upon remitter, the Arbitrator determined for the first time the worker’s ability to earn post injury.
I reject Ms Yuvarlak’s solicitors’ submissions on Mitchell steps 2 and 3. The remittal to the Arbitrator was to redetermine Ms Yuvarlak’s claim for weekly compensation under section 40 of the 1987 Act. In my view, the Arbitrator did not err at step 2 in determining what Ms Yuvarlak would be able to earn in some suitable employment, about which she had not previously made a finding, so that, as a result, no estoppel could arise. The Arbitrator’s reasoning included reference both to the general labour market reasonably accessible to Ms Yuvarlak (section 40(3)(a)) and to what constitutes suitable employment for her (section 40(3)(b) and section 43A), having regard to her physical restrictions, limited transferable skills and limited English skills (transcript page 8). Thus, I agree with the Health Service’s submissions that in the Arbitrator’s original decision, “she did not assess the worker’s ability to earn on the open labour market” taking into account Ms Yuvarlak’s work related injuries and the factors specified in section 43A, and note the Arbitrator’s finding at paragraph 50 of the statement of reasons for her original decision, that she was satisfied that Ms Yuvarlak transferred to part-time employment of two days a week for reasons unrelated to her left wrist.
Mitchell step 3 is a matter of subtracting the figure derived from step 2 from the figure derived from step 1. I reject Ms Yuvarlak’s solicitors’ submission that that my decision of 17 January 2007 created an issue estoppel as to the step 3 loss of earnings that was not amenable to challenge by either party. As stated above, I made no finding in relation to step 2, preferring to remit Ms Yuvarlak’s claim under section 40 to the Arbitrator for redetermination.
Mitchell step 4 involves the exercise of the section 40(1) discretion. As I have stated above, Ms Yuvarlak’s solicitors do not dispute the factors taken into account by the Arbitrator in the exercise of her discretion, nor that the deduction of 50% was appropriately made on the available evidence. However, they submit that the Arbitrator should have applied the deduction to the shortfall of $354.19, which they contend I ‘determined’ on appeal, rather than to the $100 shortfall determined by the Arbitrator on the remittal. Ms Yuvarlak’s solicitors submit that my ‘determination’ gives rise to “an issue estoppel” between the parties. As stated above, I reject this: I made no ‘determination’ in relation to either Mitchell step 2 or step 3.
In conclusion, I am not satisfied that the Arbitrator made any legal, factual or discretionary error in her decision on the remittal, which must, therefore, be confirmed.
DECISION
The decision of the Arbitrator dated 20 March 2007 is confirmed.
COSTS
There is no order as to the costs of this appeal.
Robin Handley
Acting Deputy President
17 July 2007
I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF ROBIN HANDLEY, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
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