Armstrong v Bowport All Roads & 2 Ors

CATCHWORDS : Review decision of Registrar and Medical Appeal Panel - Workers Compensation Commission

LEGISLATION CITED : Supreme Court Act 1970 - s 69(3) Workplace Injury Management and Workers Compensation Act 1998 - ss 323, 327, 328

Craig v South Australia (1994) 184 CLR 163 Estate of Heinrich Christian Joseph Brockmann v Brockmann Metal Roofing Pty Ltd & Ors [2006] NSWSC 235 Inghams Enterprises v Iogha & Ors [2006] NSWSC 456 CASES CITED : Massie v Southern NSW Timber & Hardware Pty Limited [2006] NSWSC 1045 Merza v Registrar of the Workers Compensation Commission [2006] NSWSC 939 Southgate v Waterford (1990) 21 NSWLR 427 Wikaira v Registrar of Workers Compensation Commission of NSW & Anor [2005] NSWSC 954 Zuanic v Gypro-Tech (Australia) Pty Limited (in liquidation) & Ors [2006] NSWSC 739

Doug Armstrong - Plaintiff PARTIES : Bowport All Roads Tranport Pty Limited - First Defendant Registrar of the Workers Compensation Commission - Second Defendant Medical Appeal Panel, Workers Compensation Commission - Third Defendant

COUNSEL : Mr D Epstein - Plaintiff Mr T M Wardell - First Defendant

Turner Freeman, Lawyers - Plaintiff SOLICITORS : Edwards Michael Moroney Lawyers - First Defendant Crown Solicitor - Submitting Appeal - Second & Third Defendants

LOWER COURT JURISDICTION : Workers Compensation Commission

LOWER COURT JUDICIAL OFFICER : Delegate of the Registrar & Medical Appeal Panel

LOWER COURT DATE OF DECISION : 2 December 2005, 15 May 2006

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION ADMINISTRATIVE LAW LIST

30098/2006 - DOUG ARMSTRONG v BOWPORT ALL ROADS TRANSPORT PTY LIMITED & 2 ORS

JUDGMENT (Review decisions of Registrar and Medical Appeal Panel - Workers Compensation Commission) 1 HER HONOUR: By amended summons filed 8 February 2007 the plaintiff seeks firstly, a declaration pursuant to s 69 of the Supreme Court Act 1970 (NSW) (SCA) that the determination made on 2 December 2005 by the Delegate of the Registrar of the Workers Compensation Commission pursuant to s 327(4) of the Workplace Injury Management and Workers Compensation Act 1998 (NSW) (WIMWCA) involved jurisdiction error and was beyond power; secondly, a declaration or order that the decision of the third defendant in Matter No. 1828/2005 before the Workers Compensation Commission dated 15 May 2006 involved jurisdictional error that was beyond power and an error on the face of the record; thirdly, an order that the decisions of 2 December 2005 and 15 May 2006 be quashed; and fourthly, an order that the second and third defendants carry out their functions in accordance with ss 327 and 328 of the WIMWCA and otherwise in accordance with the law. 2 The plaintiff is Doug Armstrong (Mr Armstrong). The first defendant is Bowport All Roads Transport Pty Limited (Bowport). The second defendant is the Registrar of the Workers Compensation Commission (the Commission). The third defendant is the Medical Appeal Panel, Workers Compensation Commission (MAP). Mr Armstrong relied on the affidavit of Baiba Lingeberzins. The second and third defendants have filed submitting appearances. For convenience I shall refer to the parties by name. 3 Section 69(3) of the SCA provides: "It is declared that the jurisdiction of the Court to grant any relief or remedy in the nature of a writ of certiorari includes jurisdiction to quash the ultimate determination of a court or tribunal in any proceedings if that determination has been made on the basis of an error of law that appears on the face of the record of the proceedings." 4 The "face of the record" is expanded to include the reasons expressed by the Court or Tribunal for its ultimate decision - s 69(4). 5 In Craig v South Australia (1994) 184 CLR 163 at 179 the High Court stated: "If such an administrative tribunal falls into an error of law which causes it to identify the wrong issue, to ask itself a wrong question, to ignore relevant material, to rely on irrelevant material or, at least in some circumstances, to make an erroneous finding or to reach a mistaken conclusion, and the tribunal's exercise or purported exercise of power is thereby affected, it exceeds its authority or powers. Such an error or law is jurisdictional error which will invalidate any order or decision of the Tribunal which reflects it." 6 There have been a number of decisions of this Court which canvass the judicial review in relation to the decision of the Registrar in the Workers Compensation Commission which I shall refer to in more detail later in this judgment.

Grounds of appeal 7 The grounds of appeal are that the Delegate of the Registrar of the Workers Compensation Commission made an error of law in finding that grounds of appeal existed pursuant to ss 327(3)(c) and (d) of the WIMWCA, and the Medical Appeal Panel erred in firstly, assessing a proportion as 10/10 and secondly, in considering the reports of Dr Preston.

Workers Compensation Commission proceedings 8 On 18 April 2005, the Commission directed that Mr Armstrong submit to medical assessment by an Approved Medical Specialist for the purposes of assessment of a permanent impairment dispute as a result of an injury sustained on 26 March 1997. 9 On 19 July 2005, Approved Medical Specialist Dr Lorraine Jones issued a Medical Assessment Certificate assessing Mr Armstrong as having sustained a 40% permanent loss of efficient use of the right leg at or above the knee. On 12 August 2005, Bowport lodged an appeal against the determination. 10 On 2 December 2005, the Delegate of the Registrar, J Lum, granted the appeal. In his reasons for determination he stated at [4]: "Having considered the submissions of the Appellant and the Respondent, it appears to the Registrar that: (i) It appears that the Approved Medical Specialist failed to consider or ignored relevant material and information in assessing the Appellant's whole person impairment. (ii) The WorkCover Guides (pages 8 and 9), under the heading "Relevant information" provide that the Approved Medical Specialist "should be provided with all relevant medical and allied health information" and "must consult these documents to gain an understanding of the information that should be provided to the assessor in order to conduct a comprehensive evaluation". (iii) The Appellant's submissions address the failure of the Approved Medical Specialist to list or refer to medical reports of Dr S Preston dated 22 March 2005, which were admitted into proceedings through the Referral for Assessment of Permanent Impairment Dispute form, issued by the Arbitrator on 18 April 2005. (iv) As the Approved Medical Specialist does not refer to these reports in the Medical Assessment Certificate, explicitly or implicitly, and it appears that the Approved Medical Specialist has not considered these reports. (v) It therefore appears that the assessment appealed against was made on the basis of incorrect criteria or the medical assessment certificate contains a demonstrable error." 11 On 27 April 2006, the Medical Appeal Panel gave reasons. 12 At [30] it stated: "30. The Panel concludes that there is no evidence of a trauma to the bone or joint of sufficient severity as to cause the development of osteoarthritis in the right hip, and that the history of the case suggests that the osteoarthritis is of a constitutional nature. In this the Panel agrees with the specialist rheumatologist Dr Preston and the orthopaedic specialist Dr Machart. The Panel finds that there is a 40% loss of use of the right leg at or above the knee due to the osteoarthritis but that 10/10 of this arises from a pre existing or constitutional condition and is not related to the injury on the 26 March 1999. 13 The Appeal Panel decided at [32] "that the Medical Assessment Certificate given in this matter should be revoked, and a new Medical Assessment Certificate should be issued." 14 It issued a certificate which is reproduced below. Body Part (described the body part as per Table of Disabilities) Date of injury Total amount of permanent % loss of efficient use or impairment Proportion of permanent impairment due to pre-existing injury, abnormality or condition Total permanent % loss of efficient use or impairment attributable to this injury (after deduction of any pre-existing impairment in column 4.) e.g. right leg at or above the knee Right leg at or above knee 26 March 1997 40% 10/10 0%

The Registrar's decision 15 Section 327 of the WIMWCA provides: "327 Appeal against medical assessment

(3) The grounds for appeal under this section are any of the following grounds: (a) deterioration of the worker's condition that results in an increase in the degree of permanent impairment,

(b) availability of additional relevant information (being evidence that was not available to the appellant before the medical assessment appealed against or that could not reasonably have been obtained by the appellant before that medical assessment),

(c) the assessment was made on the basis of incorrect criteria,

(d) the medical assessment certificate contains a demonstrable error.

(4) An appeal is to be made by application to the Registrar. The appeal is not to proceed unless the Registrar is satisfied that, on the face of the application and any submissions made to the Registrar, at least one of the grounds for appeal specified in subsection (3) has been made out. …" 16 As previously stated, on 2 December 2005, the Delegate of the Registrar of the Commission determined that the decision of the Approved Medical Specialist was made on the basis of incorrect criteria or contained a demonstrable error and found grounds for appeal pursuant to ss 327(3)(c) and (d) of the WIMWCA and referred the matter to the Appeal Panel. 17 Mr Armstrong's Counsel submitted that at paragraph 4(ii) of the determination, the Delegate of the Registrar misinterpreted the WorkCover Guides. 18 The WorkCover Guides actually read: "Referrers must consult these documents to gain an understanding of the information that should be provided to the Assessor in order to conduct a comprehensive evaluation." 19 Paragraph 4(ii) of the Delegate's reasons state: "The WorkCover Guides (pages 8 and 9), under the heading "Relevant information" provide that the Approved Medical Specialist "should be provided with all relevant medical and allied health information" and "must consult these documents to gain an understanding of the information that should be provided to the assessor in order to conduct a comprehensive evaluation." 20 Mr Armstrong submitted that the Delegate misinterpreted the WorkCover Guides to state that the Approved Medical Specialist should consult these documents when in fact no such requirement exists. Bowport conceded that the Registrar was probably incorrect in making reference to incorrect criteria and in telescoping two discrete parts of the relevant WorkCover Guides at paragraph 4(ii) of his determination. 21 However, Bowport submitted that, as the function of the Registrar under s 327(4) is to determine whether at least one of the grounds for appeal specified in subsection (3) exists, it was open to the Registrar to form the requisite opinion in relation to demonstrable error in ground (3)(d). 22 Mr Armstrong submitted that the Registrar ought to have referred the matter for further assessment pursuant to s 329 of the WIMWCA by the Approved Medical Specialist, Dr Lorraine Jones (the original Approved Medical Specialist). However, at the time the Registrar made his decision, s 327(6), which permits a matter to be remitted to the medical specialist for further assessment, was not operative. Section 327(6) became operative on 1 November 2006. This avenue was not then open to the Registrar. 23 There has been a divergence of views as to the approach that should be adopted to the judicial review of the Registrar's and the Appeal Panel's decisions in the Workers Compensation Commission.

24 In Inghams Enterprises v Iogha & Ors [2006] NSWSC 456, Latham J took a narrower view. Her Honour stated at [23]: "The plaintiff must establish that the Registrar's decision to allow the appeal to proceed was based on factual determinations which were 'illogical, irrational or lacking in basis in findings or inferences of facts supported on logical grounds." 25 Studdert J in Estate of Heinrich Christian Joseph Brockmann v Brockmann Metal Roofing Pty Ltd & Ors [2006] NSWSC 235 viewed the wording "unless it appears to the Registrar" as intended to discourage appellate review, and as an entirely subjective test. 26 In Wikaira v Registrar of Workers Compensation Commission of NSW & Anor [2005] NSWSC 954, Malpass AsJ said: "It seems to me that the section requires the Registrar to make a determination (that is, that it appears that at least one of the specified grounds for appeal exists). When that determination is made, the barrier to the appeal proceeding is removed… it seems to me… that the medical assessment certificate contained a demonstrable error… in the circumstances of the case, I am satisfied that the Registrar fell into requisite error in approaching and in performing the role prescribed by s 327(4) of the Act." 27 In Zuanic v Gypro-Tech (Australia) Pty Limited (in liquidation) and Ors [2006] NSWSC 739 at [53]-[54], Hoeben J referred to the divergence of opinion. His Honour stated: "53 On the approach followed by Studdert J and Latham J it is only necessary for the registrar to perform the process of making a subjective assessment of whether it appears that a ground for appeal in subs (3) exists. It matters not whether that assessment is correct or not. On that approach the plaintiff's submission must fail. There is nothing to suggest that the registrar's delegate did not carry out the process required of him.

54 The approach of Johnson J to s327 is a little different and is open to the interpretation, at least implicitly, that under s69 of the Supreme Court Act this Court can assess on a prima facie basis the correctness of the registrar's determination. Even on that approach which is more favourable to the plaintiff, the submission still fails." 28 However, in Merza v Registrar of the Workers Compensation Commission [2006] NSWSC 939 at [39], Hoeben J stated: "I do not propose to, nor is it necessary, that I define what is "demonstrable error" for the purposes of s 327 of the Act in an exhaustive way. It is sufficient for the purposes of this matter that I conclude that "demonstrable error" is an error which is readily apparent from an examination of the medical assessment certificate and the document referring the matter to the AMS for assessment." 29 In Massie v Southern NSW Timber & Hardware Pty Limited [2006] NSWSC 1045, Sully J considered whether the Registrar's decision constituted a jurisdictional error. The facts here are similar to the facts outlined in Massie. In Massie, the Approved Medical Specialist failed to refer to a report. The Registrar found that the report was not provided to the Approved Medical Specialist. Furthermore, the Registrar stated that as the Approved Medical Specialist had not considered this report the assessment was made on the basis of either incorrect criteria or it contained a demonstrable error. Sully J found at [42] that the Registrar had confused notions of a demonstrable error in the Approved Medical Specialist's certificate with the demonstrable need for a s 329 reassessment to cure the administrative error that had caused the report not to be placed before the medical specialist. 30 In Massie, Sully J stated at [35] that: "…absent clear statutory provision to the contrary, it ought not to be supposed that the intention of Parliament was to make simply and comprehensively unexaminable any particular exercise by a Registrar of the section 327(4) function. Any exercise of that function is more than some inconsequential procedural trifle. The Registrar's appraisal of the particular proposed appeal has serious practical consequences for both the intending appellant and the intended respondent. It is one thing to say that a particular exercise of that function should not be lightly overturned or aborted by this Court, a proposition which I consider to be plainly correct. It is, however, a very different proposition that such a particular exercise of a very important administrative function, however misconceived or mistaken it might be, is effectively beyond judicial review." 31 In Massie, Sully J came to the conclusion that the Registrar's decision was "inexact and unhelpful". In that case, it was unclear whether the doctor's report had been considered by the approved medical specialist, as no reference had been made to it. The Registrar took the view that the certificate was based on "incorrect criteria" and "demonstrable error" but Sully J disagreed. Sully J decided that, on the assumption that the medical report did not reach the Approved Medical Specialist in any form, there can be no indication of a demonstrable error in the certificate as it then stood. Sully J held that the matter should have been returned to an Approved Medical Specialist for re-assessment, to cure the administrative error of failing to place the report before the Specialist, rather than making a finding of demonstrable error. 32 Sully J then had to decide whether to exercise the court's discretion under s 69 of the Supreme Court Act to intervene and quash the Registrar's determination. His Honour decided that the discretion should not be exercised. While acknowledging that the purpose of prerogative relief is "to ensure compliance with the law and due procedure", Sully J decided that the plaintiff's failure to lodge a prompt application to quash the determination before proceeding to take a full participating role in the Appeal Panel should prevent the exercise of the court's discretion. 33 Bowport submitted that the case of Massie was wrongly decided for a number of reasons, and that there were no failings of the Registrar capable of establishing that the Medical Assessment Certificate contained a demonstrable error, as required by s 327(3)(d). Bowport submitted that Sully J's approach was incorrect in finding that no 'demonstrable error' had been made out as this would mean that a worker or employer denied the right to have the material upon which they wish to rely considered by the Approved Medical Specialist would be denied any recourse (other than by way of judicial review). 34 Bowport further submitted that in light of the nature of the Registrar's function (which is in the nature of gatekeeper) it is far more likely that the Registrar will fall into error going to the nature of the jurisdiction being exercised in refusing to allow an appeal to "proceed", rather than in a case where the Registrar allows the appeal process prescribed by the legislature to proceed to consideration by a Medical Appeal Panel constituted by persons qualified to deal with the issues raised. 35 It seems to me that this case before me is factually similar to Massie and for reasons of comity I should follow the decision of Sully J in Massie. 36 There is an error on the face of the record. The Delegate has misinterpreted the WorkCover Guides. While Sully J considered that there was a demonstrable need for a s 329 assessment to cure the administrative error because Massie did not lodge his application to this Court promptly and elected to fully participate in his appeal before the Appeal Panel, His Honour decided not grant prerogative relief. However, I would exercise the discretion differently and set aside the decision the Delegate. This is because at the time the Delegate made this decision (and likewise the Registrar's made the decision in Massie), the Registrar did not have the option to refer the matter back to the Approved Medical Specialist for reassessment to cure the administrative error that had caused the report of Dr Preston not to be placed before Dr Jones.

Appeal Panel 37 On 27 April 2006 the Appeal Panel revoked the Medical Assessment Certificate issued on 19 July 2005 by Dr Lorraine Jones and issued a new Medical Assessment Certificate. 38 In its reasons dated 15 May 2006 the Appeal Panel found: "…that there is a 40% loss of use of the right leg at or above the knee due to the osteoarthritis but that 10/10 of this arise from a pre existing or constitutional condition and is not related to the injury on the 26 March 1999 (sic)."

Reliance on Fresh Evidence 39 Mr Armstrong further argued that the Medical Appeal Panel could not rely on fresh evidence or evidence in addition to evidence received in relation to the medical assessment appealed against, unless the evidence was not available to the appellant before the medical assessment or could not have been obtained by the appellant before that assessment. Mr Armstrong submitted that the Medical Appeal Panel fell into error by accepting the report of Dr Preston as having been before the Approved Medical Specialist when it is unclear whether it was before her or not. 40 Bowport submitted that Mr Armstrong's argument had no merit in seeking to exclude reports that were properly admitted in the proceedings and referred to by the Approved Medical Specialist, but not considered by her. The flaw in Mr Armstrong's argument, they submitted, is that Dr Preston's report was not "fresh evidence", and fell within the category contained in s 328(3) of the Act, as the report was "received in relation to the medical assessment appealed against". 41 Section 328(3) reads: "Evidence that is fresh evidence or evidence in addition to or in substitution for the evidence received in relation to the medical assessment appealed against may not be given on an appeal unless the evidence was not available to the appellant before that medical assessment or could not reasonably have been obtained by the appellant before that medical assessment." 42 In Massie Sully J stated at [51]-[52]: "51 …The question for the Appeal Panel was not whether a report which was undoubtedly in existence at the relevant time and which had been caused by the first defendant to be brought into existence, had been inadvertently omitted from the materials forwarded to Dr. O'Neill. Neither was the question for the Appeal Panel whether Dr. Harris' report ought to have gone forward to Dr. O'Neill, as of course it ought to have done. The question, and the only question, for the Appeal Panel was whether the Appeal Panel itself was now entitled to receive the report as "fresh evidence" in either of the specific senses prescribed in that behalf by section 328(3).

52 In my opinion the statutory requirements could not be satisfied on the given facts; and the Appeal Panel erred in law, and that in a particular aspect which was fundamental to its ultimate decision, in holding otherwise." 43 Sully J in Massie clarified that the approach to be taken to s 328(3) is a strict one, that requires the Appeal Panel to limit itself to assessing whether it can receive the report as fresh evidence (or evidence in addition to or substitution of evidence received in relation to the medical assessment appealed against) in either of the "specific senses" prescribed by the Act, namely whether the evidence was not available to the appellant before that medical assessment, or whether it could not reasonably have been obtained by the appellant before that medical assessment.

44 Sully J came to the conclusion on the facts in Massie that not only did the Appeal Panel err in the application of the test in s 328(3), but that in his opinion the statutory requirements could not be satisfied. 45 Adopting the approach of Sully J in Massie, and on the basis of these facts, I come to the same conclusion. Dr Preston's report could not be admitted as fresh evidence under s 328(3) of the Act. This constitutes a demonstrable error on the face of the record. The decision of the Appeal Panel should be quashed.

Proportion 46 Mr Armstrong challenged the finding that he suffered a 40% loss of efficient use of his right leg above the knee due to the injury of 24 March 1997 of which the proportion due to pre-existing, abnormality or condition is 10/10. Mr Armstrong submits that as a matter of logic, a proportion cannot be the whole but a portion thereof, and there cannot be a deduction for a proportion of 10/10.

47 Section 323(1) of WIMWCA states: "(1) In assessing the degree of permanent impairment resulting from an injury, there is to be a deduction for any proportion of the impairment that is due to any previous injury (whether or not it is an injury for which compensation has been paid or is payable under Division 4 of Part 3 of the 1987 Act) or that is due to any pre-existing condition or abnormality." 48 A dispute arises in relation to the phrase "deduction for any proportion" and whether this allows the Appeal Panel to find that the whole permanent impairment (10/10) was a result of pre-existing condition or abnormality. The Macquarie Dictionary defines proportion as "a portion or part in relation to the whole". Mr Armstrong has submitted that the Court should adopt the Macquarie Dictionary meaning and accept that the whole amount cannot be deducted, but only some portion or part. 49 The Oxford English Dictionary defines proportion as "a portion or part in its relation to the whole; sometimes simply a portion, division, part". The Australian Oxford Dictionary defines proportion as "a comparative part or share, a comparative ratio". 50 Whilst the word proportion has been used in many Australian cases (notably Southgate v Waterford (1990) 21 NSWLR 427), such decisions have little to say on the meaning of word "proportion", and do not act by analogy as to how the law should be applied in the WIMWCA. 51 The meaning of "proportion" in s 323(1) could have been made clearer. If proportion was meant to include "the whole", s 323(1) should say so. However, for the reasons given earlier, it is unnecessary for this Court to decide whether or not the Appeal Panel's approach to the word "proportion" constituted a further error on the face of the record. The decisions of the Delegate of the Workers Compensation Commission dated 2 December 2005 and the decision of the Appeal Panel dated 15 May 2006 are quashed. The appeal proceedings giving rise to the decision dated 2 December 2005 are remitted to the Registrar or her Delegate to be dealt with according to law. 52 Costs are discretionary. Costs usually follow the event. The defendants are to pay the plaintiff's costs as agreed or assessed.

(1) The decision of the Delegate of the Registrar of the Workers Compensation Commission dated 2 December 2005 is quashed.

(2) The decision of the Medical Appeal Panel of the Workers Compensation Commission dated 15 May 2006 is quashed.

(3) The appeal proceedings giving rise to the decision dated 2 December 2005 are remitted to the Registrar or her Delegate to be dealt with according to law.

(4) The defendants are to pay the plaintiff's costs as agreed or assessed. **********

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