Accident Compensation Commission v CE Health Underwriting & Insurance

IN THE FEDERAL COURT OF AUSTRALIA) ) AUSTRALIAN CAPITAL TERRITORY ) ) No. ACTG 69 of 1996 DISTRICT REGISTRY ) ) GENERAL DIVISION ) BETWEEN: GRAEME PETER ILSLEY Appellant AND: WATTYL AUSTRALIA PTY LIMITED Respondent COURT: HIGGINS, COOPER & FINN JJ PLACE: CANBERRA DATE: 14 MAY 1997 REASONS FOR JUDGMENT The issues in this appeal involve the construction and application to somewhat distinctive facts, of cl 1(b) of Schedule I of the Workers' Compensation Act 1951 (ACT) ("the Act"). It is appropriate at the outset to refer to the relevant statutory provisions that bear on the matter. The Statutory Setting The Act, s7(1) provides that: "Where a worker suffers personal injury arising out of or in the course of the worker's employment, the employer is liable to pay compensation in accordance with Schedule 1." The Schedule in turn provides how the amount of compensation is to be computed in prescribed circumstances. Two of these are (i) "where the death of the worker results fromthe injury": Schedule I, cl 1(a); and (ii) "where the worker is totally incapacitated for work bythe injury": Schedule I, cl 1(b). "Injury" is defined in s6(1) of the Act to mean: "any physical or mental injury and includes aggravation, acceleration or recurrence of a pre-existing injury." The Factual Background The relevant facts fall within a narrow compass. The appellant, Mr Ilsley worked as a storeman in several stores in Canberra before commencing employment as a general storeman with the respondent in 1981. It is not disputed that his duties required the lifting of heavy weights (sometimes in very significant quantities) every day. Prior to 1986 he had experienced minor back strains. In that year the first of a series of discrete incidents occurred (several years apart) involving injury, initially to his neck and later to his back, requiring medical treatment and/or periods off work. The last of these while in the employ of the respondent happened in November 1994. While engaged in moving a large quantity of paint, he lifted a carton, "twisted around" and experienced a very sharp back pain. Shortly after that incident he resigned his position with the respondent because of his condition and of the work expected of him. In November 1994 and March 1995 he underwent a series of medical examinations. His own general practitioner, Dr Quay, who had treated him after the November 1994 incident as well as one in 1992 provided a report indicating that Mr Ilsley's prognosis was one of likely recurring back pain particularly in response to heavy lifting. He advised him that employment of a non-manual nature would be more appropriate. A consultant neurologist, Dr Davis, examined the appellant on behalf of the respondent on 3 February 1995. In his opinion there was a definite relationship between the symptomatology referable to Mr Ilsley's lumbar spine and "the distinct injuries" inflicted during the course of his employment. He concluded that Mr Ilsley should not engage in employment requiring flexion of his spine and lifting of heavy weights. Dr Anthony Cairns, an orthopaedic surgeon, examined Mr Ilsley on 15 February, again on behalf of the respondent. He concluded that Mr Ilsley had degenerative disc disease "intermittently aggravated by the nature of his employment". He regarded him as no longer fit for work of a heavy manual nature and suggested redeployment into areas of light manual activity. After a period of incapacity following the November 1994 incident, Mr Ilsley again sought work which he finally secured with BBC in that company's 'hardware house' on 26 April 1995. His physical condition had improved to the stage where he felt confident enough to work again. While his expectation of his new employment was that it might involve lighter work, it in fact required lifting similar to that done in his previous employment. On 30 June 1995 an incident occurred while lifting materials which produced severe pain in his lower back. He ceased work with BBC because of this. It would seem he has been without employment since then. He was examined in July 1995 by a neurologist, Dr White, who concluded of his condition that he suffered from a disc degeneration. The heavy nature of his work was the primary contributor to its development. He also recommended that he no longer undertake heavy lifting. Finally, in December 1995, a Dr Bornstein examined Mr Ilsley. It was his opinion that the appellant did not suffer from a back problem due to his employment. He likewise was of the view that he was not suffering from any of the specific incidents. He was considered to have recovered from each of them. A worker's compensation application was made on 10 May 1995 against the respondent. No claim was made against BBC. On 24 April 1996 a magistrate found Mr Ilsley (inter alia) to be totally incapacitated for the purposes of the Act (i) from 22 November 1994 to 25 April 1995 and (ii) from 30 June "to date and continuing". The magistrate's "reasons" are unilluminating. The respondent appealed to a single judge of the Supreme Court. It is from the decision of the Supreme Court reversing the second of the magistrate's findings noted above, that the appeal to this Court is made. The Supreme Court Decision It was not disputed in the Supreme Court that (i) from 22 November 1994 until 25 April 1995 Mr Ilsley was, in the terms of cl 1(b) of Schedule I of the Act, totally incapacitated for work by the injury he suffered in the course of his employment with the respondent; (ii) from 26 April until 30 June 1995 he suffered, relevantly, no incapacity in that his BBC salary was slightly higher than that derived from his employment with the respondent; and (iii) he was totally incapacitated for work by an injury from 30 June. The sole question dealt with by his Honour was whether the totally incapacitating injury was suffered in the course of his employment with the respondent or with BBC. His Honour concluded that on 30 June he suffered a "stark incident" while employed by BBC; that had that incident not occurred he would have kept working for BBC; and that it stopped him from working. Accepting that the cl 1(b) formula embodies a causation concept which requires "common sense" application, his Honour concluded that the total incapacity of 30 June was caused by the injury of that date and hence the wrong employer had been held liable to pay compensation under the Act. In reaching this conclusion his Honour did not consider that the incapacity resulted from "two or more injuries sustained on separate occasions in ... employment with different employers" in which case a claim could have been made against each of the employers: cf Bushby v Morris [1980] 1 NSWLR 81. The causation concept he applied was that expressed by Kirby P in Koorang Cement Pty Ltd v Bates (1994) 35 NSWLR 452 at 463-464. It is unnecessary to set out the relevant passage here. The Appeal to this Court The basis of the appeal is that it was not open on the evidence for his Honour to find that Mr Ilsley's total incapacity was caused only by his injury at BBC. It is submitted that the "two or more injuries" proposition of Bushby v Morris, above, ought to have been applied in that the appellant's incapacity was materially contributed to by the injuries sustained in the respondent's employment. In reply, the appellant sought to argue for the first time that it was those injuries which were the effective cause of his incapacity rather than the 'stark' incident with BBC. Reliance for this proposition was placed upon the observations of Moffit P in Morris v George [1977] 2 NSWLR 552 at 567. In commenting on causally unrelated injuries, his Honour there noted that: "even where one injury does not cause the other, there may be relevant evidence which will leave open the conclusions that incapacity or death results from an earlier injury. Thus a first back injury may be of such major proportions that incapacity is recurrent and even progressive, and a second accident or incident so minor or so much a part of normal activity that it is open to find that a later incapacity following the second accident or incident resulted from the initial injury." The respondent has not disputed that there was a connection between the condition of Mr Ilsley's back prior to the 30 June 1995 incident and his employment with the respondent. Its case is, simply, that despite the prior injuries he had suffered, he had a capacity for work as evidenced by his employment at BBC and he was totally incapacitated for work by the injury suffered as a result of that incident. That injury was, it was contended, an aggravation of a pre-existing injury causing a new level of incapacity. Whether or not Mr Ilsley has a claim against the respondent turns upon whether the scheme of the Act allows for such a claim in the circumstances. In ascertaining the elements of that scheme "[t]here is ... no substitute for the statutory text": see Accident Compensation Commission v CE Health Underwriting & Insurance (Aust) Pty Ltd (1994) 68 ALJR 525 at 526 per Brennan J. We emphasise this at the outset. Counsel for the appellant has referred us to a number of observations on causation made in cases involving differently worded workers' compensation legislation of New South Wales and Victoria as if those observations were of immediate relevance to the interpretation of cl 1(b) of Schedule I of the Act. While it may well be the case that the ACT Act on its proper construction embodies a like test of causation to that contained in the differently worded legislation of another jurisdiction - and it would be unwise to presume that there is one test common to, say, the New South Wales and Victorian legislation: cf Koorang Cement Pty Ltd v Bates, above, at 461ff for New South Wales' own problems: - it is clearly an error to make the a priori assumption that such is the case. To illustrate the differences in statutory wording, the New South Wales legislation considered in the cases relied on by the appellant related to claims where incapacity for work "results from" the relevant injury: see eg Bushby v Morris above; see also Australian Eagle Insurance Co Ltd v Federation Insurance Ltd (1976) 15 SASR 282; the Victorian legislation used the formula "results from or is materially contributed to" by the injury: see Accident Compensation Commission v C E Heath Underwriting & Insurance (Aust) Pty Ltd, above. Turning now to the question of construction, it is revealing to consider the legislative antecedents in the ACT of clauses 1(a) and 1 (b) of Schedule I of the Act. Workers' compensation legislation was first enacted in 1931 in the Workmen's Compensation Ordinance. As with the 1951 Act, Schedule I of that Ordinance in providing for the amount of compensation to be paid, differentiated between death from injury and incapacity from injury. In both instances, though, the legislative language took the impersonal form of "where death results from the injury": cl 1(a); and "where total incapacity for work results from the injury": cl 1(b). The same form and formula were continued in the Workmen's Compensation Ordinance 1946 that repealed the 1931 Ordinance. With the advent of the present Act in 1951 there was a change in the form and formula. In the case of death from injury the "results from" formula was retained. With total and partial incapacity the impersonal form of expression used in the 1931 and 1946 Ordinances was abandoned - and with it, necessarily, the "results from" formula. In its stead, as we have already indicated, cl 1(b) took the form "where the workman is totally incapacitated for work by the injury". Were it not for the assistance to be derived from this history, it might be thought that, to the extent that cl 1(a) and cl 1(b) in the present legislation raise issues of causation, the different formulae used (ie "results from" and "incapacitated ... by") suggest that possibly different tests of causation were to be applied in each instance with the cl 1(b) formula, perhaps, requiring the relevant injury to be the direct or proximate cause of the incapacity. Having regard to the incapacity provisions of the earlier Ordinances, and to the fact that the "results from" formula was rendered inappropriate by the change from an impersonal to personal form of expression, we do not consider that the recasting of cl 1(b) in the 1951 Act was intended to introduce any new or different notion of causation for the purposes of that clause than had obtained under the counterpart provisions of the earlier legislation. Likewise there was no operative difference intended for causation purposes between the "results from" formula of cl 1(a) and the "by" formula of cl 1 (b). A clear consequence of this construction of cl 1(b) is that resort may appropriately be had to New South Wales authority on the formula in that State's legislation for the purpose of illuminating how cl 1(b) should be applied. That the clause raises a question of causation is not open to question: see Koorang Cement Pty Ltd v Bates, above, at 463-464. It should be taken as "unarguably clear and generally accepted" since at least the Morris v George litigation: ie Morris v George above; Bushby v Morris above; that an incapacity can result from more than one injury: see Switzerland Insurance Workers Compensation (NSW) Ltd v Burley, New South Wales Court of Appeal, 5 December 1996, unreported per Mahoney P. It likewise should be taken as clear that the notion of causation imported by the clause does not limit the operative injury (or injuries) "to the immediate proximate cause of incapacity": Koorang Cement Pty Ltd v Bates, above, 463. Whether total incapacity results from an injury is a question of fact. This is no different from the application to a given case of the common law principles of causation in negligence cases: cf March v E & M H Stramare Pty Ltd (1991) 171 CLR 506; a "common sense" evaluation of the causal chain is required - that evaluation being made in light of the statutory formula itself. The only additional general comments we consider it necessary to make are these. First, where the causal chain reveals multiple and sequential (or cumulative) injuries that are alleged to provide causes for an incapacity, before an earlier such injury can properly be said to be an injury for the purposes of cl 1(b), it must be able to be said that it remained an effective or operative cause of the incapacity. Secondly, as is well recognised, the sustaining of an injury and the onset of incapacity resulting from that injury need not, and commonly does not, occur simultaneously: Accident Compensation Commission v C E Heath Underwriting & Insurance (Aust) Pty Ltd, above, at 526-527. Despite the new submission raised by the appellant in reply to which we earlier referred, we are compelled to conclude the injury sustained by Mr Ilsley on 30 June was the immediate proximate cause of his total incapacity. Before the incident of that day he was not so incapacitated. After it, he was. What in our view is equally clear is that the injuries sustained in the respondent's employment were also operative and therefore effective causes of that incapacity in that they contributed materially to the condition which was aggravated by the 30 June incident. Of themselves they did not totally incapacitate. But as the medical evidence from examinations conducted prior to that date all indicated, Mr Ilsley was from November 1994 unfit for work requiring heavy lifting. His circumstance then was not merely one of a person predisposed to subsequent injury which would cause total incapacity. Causes of that incapacity were latent from November though their effect was only realised in the 30 June incident. We note in passing that where, as here, different injuries from different employments are causes of an incapacity, legislation in other jurisdictions allows for the apportionment of the liability to pay compensation between the various employers. Such is not the case with the 1951 Act. Such apportionment is left to separate proceedings under the general law. This deficiency is a matter which should be drawn to the attention of the relevant ACT authorities. For the reasons we have given we cannot agree with the conclusion reached in the Supreme Court. Accordingly we allow the appeal and make the following orders: 1. The appeal from the judgment and orders of the Supreme Court made and entered on 7 November 1996 be allowed. 2. The orders of the Supreme Court made on 7 November 1996 be set aside and in lieu thereof it is ordered: - (a) the award and orders of Magistrate Ward made on 24 April 1996 be varied to delete from para 3(ii) the words "partial incapacity between 26 April 1995 and 30 June 1995". (b) Wattyl Australia Pty Limited pay the costs of Graeme Peter Ilsley of the proceedings in the Supreme Court. 3. The respondent on the appeal pay the appellant's costs of and incidental to the appeal to be taxed if not agreed. I certify that this and the preceding 15 pages are a true copy of the Reasons for Judgment of the Court. Associate Dated: 13 May 1997 Counsel for the appellant : R E Williams QC, R L Crowe Solicitors for the appellant: Pamela Coward & Associates Counsel for the respondent : G P McNally Solicitors for the respondent : Allen Allen & Hemsley Date of hearing : 14 April 1997 Date of judgment : 14 May 1997