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[2026] NSWCA 93
appellant. Appeal allowed. The orders of Deputy President Snell dated 21 July 2025 were set aside, and the Certificate of Determination dated 16 December 2024 was confirmed. Costs were subject to the...
The Court held that the 2024 Order did not say that a prosthesis absent from the Prostheses List attracted a nil payment. Clause 8(1) sets the applicable minimum benefit rate when a prosthesis is selected from that List. Because the disputed prosthesis was not on the List and the Order did not otherwise set a maximum for it, the statutory default measure applied: the cost to the hospital. The Court allowed Bishop's appeal and restored the Commission determination in his favour.
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2,223 words · generated 08/10/2026
Bradley Bishop worked as a Qantas baggage handler. On 15 October 2020, while connecting a tow bar to a motor vehicle in the course of his employment, he injured his left shoulder and neck: [9]-[10]. He later underwent cervical fusion and shoulder surgery. The shoulder procedures improved his movement, but he continued to experience shoulder pain: [11].
7 cited instruments linked from this judgment.
In June 2024, his orthopaedic surgeon, Dr Harper, sought authorisation for a left shoulder pyrocarbon hemi-arthroplasty. The proposed operation involved a “pyrocarbon humeral head” implant, referred to in the judgment as the Shoulder Prosthesis: [12]. Dr Harper said there was no other implant he would use to address Bishop's arthritis and described the operation as Bishop's best chance of restoring pain relief and long-term function. The prosthesis was not approved by the Therapeutic Goods Administration and was not on the relevant Commonwealth Prostheses List: [12], [30]-[31].
Qantas declined the request. It relied on s 62(1A) of the Workers Compensation Act 1987 (NSW) and cl 8(1) of the Workers Compensation (Private Hospital Maximum Rates) Order 2024 (NSW). Qantas' position was that because the prosthesis was not listed, the Order fixed the maximum payable amount at nil: [13]-[14], [29], [35].
The Personal Injury Commission initially determined the dispute in Bishop's favour. On appeal within the Commission, Deputy President Snell set that determination aside and made an award in Qantas' favour: [5]-[6]. Bishop appealed to the Court of Appeal. The central issue was the meaning of cl 8(1), not whether the treatment was reasonably necessary. The parties agreed that the procedure was hospital treatment, was reasonably necessary because of the work injury, and resulted from that injury: [19].
The Court of Appeal allowed Bishop's appeal. It set aside the Deputy President's orders and confirmed the Certificate of Determination dated 16 December 2024: [59]-[60]. The judgment therefore resolves a question about how the Order affects the amount payable for a prosthesis that is outside the Prostheses List.
The Court began by separating the existence of liability from its amount. Section 60(1) is the primary provision creating an employer's liability for the cost of specified treatment where the statutory conditions are met: [16]-[17]. Section 62 addresses quantification for hospital treatment. Under s 62(1), the default amount is “the cost to the hospital of the hospital treatment”: [22], [24].
Section 62(1A) allows the Authority to set a maximum amount by Gazette order. But the wording “(if any)” means the Authority need not set a maximum for every form of hospital treatment: [26]. The Court described the statutory process as first identifying the particular hospital treatment for which the employer is liable, and then asking whether an order fixes a maximum in respect of that treatment: [27]. If no maximum is fixed, s 62(1) remains the relevant quantification provision.
Qantas' proposed interpretation gave cl 8(1) two effects. For prostheses on the List, it would cap the employer's liability at the listed minimum benefit. For prostheses absent from the List, it would cap liability at nil: [35]. The Court accepted that the first effect could be read in context, particularly because cl 3 says that the Order “sets the maximum fees” for which an employer is liable: [37]. But the second effect had no clear textual foundation. Clause 8(1) did not say what happened if a prosthesis was not selected from the List, and did not say that the amount payable in that circumstance was nil: [36], [38].
That absence mattered because the statutory scheme treats liability as already arising under s 60(1). Section 62(1A) is directed to the amount of liability, not to whether liability exists at all: [38], [40]. Reading the Order as removing liability altogether for an unlisted prosthesis would make the Order, made under a quantification power, operate as the source of an exclusion from the statutory liability. The Court found that reading difficult to reconcile with the Act: [40].
The Court also considered the language “are to be selected from”. Qantas argued that these words had mandatory force and required selection from the List. The judgment acknowledged that this is one possible reading, but noted that Qantas accepted the power in s 62(1A) would not authorise a command or prohibition about which prostheses could be selected: [33]-[34]. The Court described the language as obscure in the context of the statutory scheme and the source of the Order-making power: [41].
The wording had to be read as a whole. Clause 8(1) ends with the words “at the minimum benefit rate”. The Court considered that the clause's mandatory force could sensibly apply to the applicable rate when a prosthesis is selected from the List, rather than to the selection itself: [45]. That reading gave the clause work to do, fitted the statutory power, and was consistent with s 62(1A)'s allowance for there to be no fixed maximum for some treatments: [46].
The Court's approach was also informed by the Order's drafting. It identified other provisions whose language was more direct when an amount was not payable, including cl 10's statement that “[t]here is no additional fee payable for a single room”: [47]. This contrast supported the conclusion that cl 8(1) did not quietly establish a nil amount for unlisted prostheses.
The judgment describes the statutory framework before resolving the interpretive dispute. Section 60(1) provides for employer liability where treatment is reasonably necessary as a result of a worker's injury. Section 62(1) provides the default measure for hospital treatment: the cost to the hospital. Section 62(1A) permits the Authority to set a maximum amount for particular treatment by order: [16], [22]-[27].
The judgment does not describe a general rule that every hospital treatment must be covered by a maximum-rate order. To the contrary, it reads “(if any)” in s 62(1A) as confirming that a maximum may not be fixed for every treatment: [26]. It also explains that the operation of an order depends on whether it fixes a maximum “in respect of” the particular treatment, whether by naming it or by including it within a class: [27].
The appeal clarifies how cl 8(1) of the 2024 Order operates within that framework. For a prosthesis selected from the Prostheses List, the clause prescribes the minimum benefit rate as the relevant rate: [45]-[47]. For a prosthesis not on the List, the clause does not itself set a maximum. The statutory default, the cost to the hospital, therefore applies in the circumstances before the Court: [48]-[49].
The Court did not decide that every unlisted prosthesis must be paid for, or that all other statutory or regulatory limits are irrelevant. Its conclusion depended on the facts that the parties agreed the treatment was reasonably necessary hospital treatment resulting from the injury, and that no other identified limitation restricted Qantas' liability in relation to the Shoulder Prosthesis: [19]-[21]. The decision concerns the construction of this Order and the application of the statutory provisions set out in the judgment.
The Court also expressly left open a question about s 60A(b) and its reference to an applicable maximum “calculated as fixed under section 62(1) as the cost to the hospital of the treatment”. It said that whether that reference should be understood as subject to s 62(1A) should be decided in a case where the answer is necessary: [55]. That issue is therefore not resolved by this judgment.
At [24], McHugh JA describes the relationship between ss 60(1) and 62(1): “the combination of ss 60(1) and 62(1) creates a statutory liability in the employer to pay the cost of hospital treatment, quantified as the cost to the hospital.” In plain English, the Act first establishes liability when its conditions are met, then gives a default way to calculate the amount.
At [26], the judgment says the words “(if any)” mean the Authority “is not required to fix a maximum sum in respect of every form of hospital treatment.” In plain English, the statutory scheme allows some treatment to have no specific maximum set by an order.
At [38]-[40], the Court rejects the idea that an order about maximum amounts can, without clear words, erase liability arising under s 60(1). The concern is that a nil amount would mean no payment at all, even though the statutory liability has already arisen. The judgment distinguishes that question from the quantification function assigned to s 62.
At [45], the Court explains its reading of cl 8(1): “when a ‘[s]urgical prosthes[i]s’ is ‘selected from the … Prostheses List’, the selection is ‘at the minimum benefit rate’.” In plain English, the clause sets the rate applicable to listed prostheses; it does not establish that a prosthesis must be listed before any amount can be payable.
At [48]-[49], the Court applies that interpretation to Bishop's prosthesis. As the Order did not fix a maximum for it, the amount was the cost to the hospital under ss 60(1) and 62(1).
The Court referred to Arnold v Britton at [42] and to Gill v Donald Humberstone & Co Ltd, Environment Protection Authority v Orchard Holdings (NSW) Pty Ltd (in liq) and Day v Harness Racing (NSW) at [44]. It used those authorities in considering how to approach the language of a poorly drafted instrument made under statute. The judgment's stated focus remains the text of cl 8(1), read in the context of the Act and the Order.
The decision is most directly relevant to disputes with the same interpretive features: an employer's liability for hospital treatment is otherwise established; a statutory provision supplies a default amount; a delegated order can set maximum amounts; and a disputed treatment or item is not expressly covered by the order.
The specific factual conditions here were important. The parties agreed the operation was hospital treatment, reasonably necessary, and required as a result of a work injury: [19]. There was no suggestion that the time limits in s 59A or the Workers Compensation Guidelines restricted liability: [20]. The dispute was therefore about quantification under s 62, rather than whether the s 60(1) conditions were met: [21], [27]-[29].
The decision also turns on the wording and structure of cl 8(1). The Court did not read “are to be selected from” as imposing a requirement to select only listed prostheses, or as setting a nil maximum for unlisted ones. Instead, it read the words together with “at the minimum benefit rate”: [41], [45]-[47]. Applying the reasoning to another order would require attention to that instrument's actual language, statutory authority, and context. This judgment does not establish that every order referring to a list should be construed in the same way.
Nor does the decision determine the reasonableness or medical suitability of other treatments or devices. It records Dr Harper's views about the Shoulder Prosthesis, but the parties' agreement on reasonable necessity meant that issue was not in dispute before the Court: [12], [19]. The holding concerns how the Order affects the amount payable after liability has been established.
The supplied judgment contains no account of later judicial treatment. It is dated 21 May 2026, and the material provided does not identify any later decisions applying, distinguishing, or questioning its reasoning. No later-court relationship can therefore be reliably stated from this source.
The judgment does cite and use earlier authorities. At [42], McHugh JA refers to Arnold v Britton on the relationship between clarity of drafting and a court's willingness to depart from natural meaning. At [44], he refers to Gill v Donald Humberstone & Co Ltd, Environment Protection Authority v Orchard Holdings (NSW) Pty Ltd (in liq) and Day v Harness Racing (NSW) in support of a practical approach to construing instruments made under statute. Those citations describe authorities considered in this judgment; they are not later treatment of Bishop.
The Court expressly left several matters undecided. First, it did not decide the construction of s 60A(b) and whether the reference there to a maximum calculated under s 62(1) should be read subject to s 62(1A): [55]. The Court said that question should await a case in which it must be resolved.
Second, the Court did not decide what relief would have been appropriate had Bishop's alternative argument succeeded, namely that cl 8(1) was beyond the power in s 62(1A): [52]-[54]. That issue fell away once the Court accepted Bishop's primary construction argument.
Third, the decision does not resolve how other provisions of the 1987 Act, guidelines, or differently worded maximum-rate orders might affect liability for other treatment. The judgment notes that limits can affect liability and that the statutory scheme includes other provisions, but the dispute concerned cl 8(1) and the Shoulder Prosthesis: [18]-[21], [28]-[29].
Finally, the Court did not decide any dispute about the actual amount charged by the hospital, or any factual disagreement over the treatment's necessity. The parties' common ground confined the appeal to the interpretation of the Order: [8], [19]. These boundaries matter when identifying what the precedent establishes: the Order did not set a maximum for this unlisted prosthesis, and the default amount under s 62(1) applied.
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Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: Bishop v Qantas Airways Ltd [2026] NSWCA 93
Hearing dates: 30 April 2026
Date of orders: 21 May 2026
Decision date: 21 May 2026
Before: Adamson JA at [1]
McHugh JA at [2]
Free JA at [61]
Decision: (1) Appeal allowed.
(2) Orders of Deputy President Snell dated 21 July 2025 are set aside.
(3) In lieu thereof, the Certificate of Determination dated 16 December 2024 is confirmed.
(4) In the event that the respondent does not exercise the liberty referred to in Order 5 within 7 days of the date of these orders, order the respondent to pay the appellant’s costs.
(5) Grant liberty to the respondent to file and serve within 7 days of the date of these orders any written submissions it wishes to make as to costs, such submissions not to exceed 4 pages in length.
(6) In the event that the respondent files submissions pursuant to Order 5, direct the appellant to file and serve within 14 days of the date of these orders responsive submissions in writing not exceeding 4 pages in length.
(7) Any question of costs arising out of Orders 5 and 6 be determined on the papers.
Catchwords: WORKERS COMPENSATION — Compensation for medical, hospital and rehabilitation expenses — Limits on employer liability — s 62(1A) of the Workers Compensation Act 1987 (NSW) — whether Workers Compensation (Private Hospital Maximum Rates) Order 2024 (NSW) made pursuant to s 62(1A) fixes maximum amount of employer’s liability for hospital treatment not specified in Order
Legislation Cited: State Insurance and Care Governance Act 2015 (NSW)
Workers Compensation Act 1987 (NSW), ss 3, 59, 59A, 60, 60A, 62
Workplace Injury Management and Workers Compensation Act 1998 (NSW), ss 78, 376
Private Health Insurance (Medical Devices and Human Tissue Products) Rules (No. 1) 2023 (Cth)
Uniform Civil Procedure Rules 2002 (NSW), r 42.1
Workers Compensation (Private Hospital Maximum Rates) Order 2024 (NSW), cll 3, 4, 5, 8
Cases Cited: Arnold v Britton [2015] AC 1619; [2015] UKSC 36
Day v Harness Racing (NSW) (2014) 88 NSWLR 594; [2014] NSWCA 423
Environment Protection Authority v Orchard Holdings (NSW) Pty Ltd (in liq) (2014) 86 NSWLR 499; [2014] NSWCA 149
Gill v Donald Humberstone & Co Ltd [1963] 1 WLR 929; [1963] 3 All E.R. 180
Category: Principal judgment
Parties: Bradley Bishop (Appellant)
Qantas Airways Limited (Respondent)
Representation: Counsel:
D Hooke SC; L D Robison (Appellant)
P Herzfeld SC; F J Doak (Respondent)
Solicitors:
Santone Lawyers (Appellant)
Hall & Wilcox Lawyers (Respondent)
File Number(s): 2025/00311908
Publication restriction: N/A
[This headnote is not to be read as part of the judgment]
On 15 October 2020, the appellant (Mr Bishop) injured his left shoulder and neck while connecting a tow bar to a motor vehicle in the course of his employment as a baggage handler for the respondent (Qantas). On 6 June 2024, Mr Bishop’s orthopaedic surgeon, Dr Harper, wrote to Qantas seeking authorisation to perform surgery on Mr Bishop in the form of a “left shoulder pyrocarbon hemi-arthroplasty” to relieve ongoing left shoulder pain caused by the 15 October 2020 injury (the Procedure), and confirmation that Qantas accepted liability to pay all fees and costs for the Procedure, in accordance with s 60 of the Workers Compensation Act 1987 (NSW) (the 1987 Act). The Procedure involved a “pyrocarbon humeral head” implant (the Shoulder Prosthesis), which had not been approved by the Therapeutic Goods Administration, but was said by Dr Harper to be Mr Bishop’s “best chance of restoring pain relief and long-term function”.
On 17 June 2024, Qantas issued a notice under s 78 of the Workplace Injury Management and Workers Compensation Act 1998 (NSW) declining Mr Bishop’s claim for payment of all fees and costs for the Procedure. Qantas relied on s 62(1A) of the 1987 Act, which provided:
62 Rates applicable for hospital treatment (cf former s 10 (2A), (3))
… (1A) The maximum amount for which an employer is liable for any particular hospital treatment is not to exceed such sum (if any) as may be fixed by the Authority in respect of that treatment by order published in the Gazette. …
The relevant order was the Workers Compensation (Private Hospital Maximum Rates) Order 2024 (the Order), which provided, at cl 8(1):
8. Fees for Surgically Implanted Prostheses and Handling
(1) Surgical prostheses are to be selected from the Department of Health Prostheses List (in accordance with the Private Health Insurance (Prostheses) Rules (Cth) rate current at the time of service) at the minimum benefit rate.
Mr Bishop applied to the Personal Injury Commission for a determination that Qantas pay the cost of the Procedure on the basis that cl 8(1) of the Order did not fix a maximum amount for which an employer is liable for the Shoulder Prosthesis, such that the amount for which Qantas was liable for the Shoulder Prosthesis is the cost to the hospital of that treatment (pursuant to ss 60(1) and 62(1) of the 1987 Act). Qantas denied liability on the basis that, as the Shoulder Prosthesis was not on the applicable Prostheses List, the Order must be read as fixing the maximum sum payable for the Procedure at nil.
On 16 December 2024, Senior Member Haddock made a determination in favour of Mr Bishop for the cost of the Procedure. Qantas appealed, and on 21 July 2025, Deputy President Snell made an order revoking the determination made by Senior Member Haddock, and in lieu thereof, made an award in favour of Qantas. Mr Bishop appealed to the Court of Appeal, where the dispositive question was the construction of cl 8(1) of the Order.
The Court held (McHugh JA, Adamson and Free JJA agreeing), allowing the appeal:
Arnold v Britton [2015] AC 1619; [2015] UKSC 36; Gill v Donald Humberstone & Co Ltd [1963] 3 All E.R. 180; [1963] 1 WLR 929; Environment Protection Authority v Orchard Holdings (NSW) Pty Ltd (in liq*)* (2014) 86 NSWLR 499; [2014] NSWCA 149; Day v Harness Racing (NSW) (2014) 88 NSWLR 594; [2014] NSWCA 423 cited.
ADAMSON JA: I agree with McHugh JA.
McHUGH JA: Mr Bradley Bishop appeals from a decision of the Personal Injury Commission (Deputy President Snell) made on 21 July 2025, the effect of which was that the respondent (Qantas) was not liable to pay the cost of a “left shoulder pyrocarbon hemi-arthroplasty”, a procedure involving a surgical prosthesis, performed on Mr Bishop.
The dispositive question in the appeal is the construction of cl 8(1) of the Workers Compensation (Private Hospital Maximum Rates) Order 2024 (NSW) (the Order). Clause 8 provides:
“8. Fees for Surgically Implanted Prostheses and Handling
(1) Surgical prostheses are to be selected from the Department of Health Prostheses List (in accordance with the Private Health Insurance (Prostheses) Rules (Cth) rate current at the time of service) at the minimum benefit rate.
(2) A 5% handling fee may be applied to each item up to a maximum of $189.00 per item.”
Three constructions of cl 8(1) were advanced by the parties. The effect of those constructions was as follows.
Qantas contends that:
(a) with respect to surgical prostheses specified in the “Department of Health Prostheses List” (Prostheses List), cl 8 fixed the maximum amount for which an employer was liable at the “minimum benefit” rate in the Prostheses List; and (b) with respect to surgical prostheses not specified in the Prostheses List, cl 8 fixed the maximum amount for which an employer is liable at nil.
As to (1)(b) above, Mr Bishop primarily contends that cl 8 says nothing about the maximum amount for which an employer is liable in respect of “surgical prostheses” not specified in the Prostheses List.
Alternatively, Mr Bishop contends that cl 8 purports to prohibit workers from undergoing surgery to implant surgical prostheses other than those identified on the Prostheses List. If so, it is common ground that in that respect the Order would be beyond the power said to authorise its making, namely, s 62(1A) of the Workers Compensation Act 1987 (NSW) (the 1987 Act).
Senior Member Haddock in substance accepted Qantas’ construction, but found in favour of Mr Bishop on the basis that the Commission had the power to direct that Qantas was liable for an amount additional to the sum fixed by the Order, relying on ss 62(6) and (6A) of the 1987 Act.
Deputy President Snell allowed an appeal in favour of Qantas, both as to construction of the Order, and as to the scope of s 62(6) and (6A). The Deputy President made an order in favour of Qantas.
Mr Bishop’s primary contention as to construction of the Order is correct. The appeal to this Court should be allowed with costs.
Almost every aspect of this case other than the construction of cl 8(1) is a matter of common ground.
Mr Bishop was employed by Qantas as a baggage handler from 1992 until April 2021, when he was made redundant. During the course of his employment with Qantas, Mr Bishop suffered various injuries for which he received medical treatment.
On 15 October 2020, Mr Bishop injured his left shoulder and neck while connecting a tow bar to a motor vehicle in the course of his employment with Qantas (the Injury).
On 15 August 2023, Mr Bishop underwent a cervical fusion at C4/5 as a result of the Injury. On 14 November 2023, Mr Bishop underwent a left shoulder synovectomy and left bicep tenodesis performed as a result of the Injury. The synovectomy and tenodesis were performed by Dr Wade Harper, an orthopaedic surgeon. The synovectomy and tenodesis “improved movement but [Mr Bishop] had ongoing left shoulder pain.”
On 6 June 2024, Dr Harper wrote to Qantas seeking written authorisation to perform further surgery on Mr Bishop in the form of a “left shoulder pyrocarbon hemi-arthroplasty” to relieve ongoing left shoulder pain, and confirmation that Qantas accepted liability to pay all fees and costs for the procedure. On 15 June 2024, in response to questions asked of him by Qantas, Dr Harper provided a letter to Qantas describing the proposed procedure as involving an implant, being a “pyrocarbon humeral head” (the Shoulder Prosthesis). The Shoulder Prosthesis had not been approved by the Therapeutic Goods Administration. However, Dr Harper explained in his letter, “There is no other implant that I would use to resolve [Mr Bishop’s] arthritis”. Dr Harper also asserted that “the pyrocarbon hemiarthroplasty is [Mr Bishop’s] best chance of restoring pain relief and long-term function.”
On 17 June 2024, Qantas declined Mr Bishop’s claim for payment of all fees and costs for left shoulder pyrocarbon hemi-arthroplasty and gave reasons for that decision.
In its dispute notice pursuant to s 78 of the Workplace Injury Management and Workers Compensation Act 1998 (NSW) (the 1998 Act), Qantas said:
“In consideration of Section 62(1A) of the 1987 Act and based on Dr Harper’s response and the [Order], Qantas are unable to consider the requested Anatomic/Hemi Shoulder Replacement (left shoulder) as the requested prosthesis is not on the Department of Health Prostheses List. As a result, we are unable to determine that the requested Anatomic/Hemi Shoulder Replacement is reasonably necessary as required by section 60 of the 1987 Act.”
60 Compensation for cost of medical or hospital treatment and rehabilitation etc
(1) If, as a result of an injury received by a worker, it is reasonably necessary that—
(a) any medical or related treatment (other than domestic assistance) be given, or
(b) any hospital treatment be given, or
(c) any ambulance service be provided, or
(d) any workplace rehabilitation service be provided,
the worker’s employer is liable to pay, in addition to any other compensation under this Act, the cost of that treatment or service and the related travel expenses specified in subsection (2).
…
(2C) The Workers Compensation Guidelines may make provision for or with respect to the following—
(a) establishing rules to be applied in determining whether it is reasonably necessary for a treatment or service to be given or provided,
(b) limiting the kinds of treatment and service (and related travel expenses) that an employer is liable to pay the cost of under this section,
(c) limiting the amount for which an employer is liable to pay under this section for any particular treatment or service,
(d) establishing standard treatment plans for the treatment of particular injuries or classes of injury,
(e) specifying the qualifications or experience that a person requires to be appropriately qualified for the purposes of this section to give or provide a treatment or service to an injured worker (including by providing that a person is not appropriately qualified unless approved or accredited by the Authority).
…
(Emphasis in original.)
The basic criteria of liability — as opposed to quantum — are those found in s 60(1): whether, as a result of an injury received by a worker, it is reasonably necessary that the medical or hospital treatment be given.
However, even where the s 60(1) matters are established, the 1987 Act contains various limitations on the employer’s prima facie liability. For example, s 59A provides for various time limits after which compensation is no longer payable. And s 60(2C) provides that the Workers Compensation Guidelines (made pursuant to s 376(1)(c) of the 1998 Act) may limit the kinds of treatment that an employer is liable to pay the cost of, or the amount for which an employer is liable. It is important to observe that where those limitations apply, or where it is not “reasonably necessary” that the treatment be given, the employer has no liability to pay the cost of the treatment at all. In such cases, the questions relating to quantification referred to below do not arise.
In this case, it is common ground that:
the left shoulder pyrocarbon hemi-arthroplasty here was “hospital treatment” (as defined in s 59 of the 1987 Act);
it was “reasonably necessary” that that “hospital treatment be given” within the meaning of s 60(1)(b); and
that was so “as a result of an injury received by a worker”.
There is no suggestion that either the s 59A time limits, or anything stated in any Guidelines, operated to restrict any liability in Qantas with respect to the Shoulder Prosthesis.
It follows that the effect of s 60(1) is that Qantas is liable to pay the cost of that treatment, subject to the provisions of the 1987 Act directed to quantification.
62 Rates applicable for hospital treatment (cf former s 10 (2A), (3))
(1) The amount for which an employer is liable in respect of hospital treatment of a worker at a hospital is the cost to the hospital of the hospital treatment.
(1A) The maximum amount for which an employer is liable for any particular hospital treatment is not to exceed such sum (if any) as may be fixed by the Authority in respect of that treatment by order published in the Gazette.
(2)–(4) (Repealed)
(5) The maximum amount for which an employer is liable for hospital treatment given to a worker in respect of the same injury (whether the treatment is afforded at different stages of the injury or not) is—
(a) $50,000, or
(b) where some greater amount has been fixed by the Authority by order published in the Gazette—that greater amount.
…
(7) A hospital, or a duly authorised officer of the hospital, may recover from the employer any amount for which the employer is liable under this Division in respect of hospital treatment given by that hospital.
…
Several matters should be noted. First, s 62 is directed to “hospital treatment” (as defined in s 59), not “medical or related treatment” (as defined in s 59).
Secondly, s 62(1) provides for a default measure by which to quantify the employer’s liability in respect of hospital treatment: “the cost to the hospital of the hospital treatment”. It is worth pausing to note the central role s 62(1) plays in the basic statutory scheme with respect to hospital treatment: the combination of ss 60(1) and 62(1) creates a statutory liability in the employer to pay the cost of hospital treatment, quantified as the cost to the hospital.
Thirdly, the default measure of quantification in subs (1) is, however, affected by the operation — if any in a particular case — of subss (1A) and (5).
Fourthly, s 62(1A) is the provision of present relevance. This confers a power on the Authority (meaning the State Insurance Regulatory Authority constituted under the State Insurance and Care Governance Act 2015 (NSW): see s 3(1) of the 1987 Act) to fix, by order published in the Gazette, maximum amounts for which an employer is liable for hospital treatments. However, the words “(if any)” make clear that the Authority is not required to fix a maximum sum in respect of every form of hospital treatment. That is a matter of some importance in the present case. The statutory scheme does not assume that the subs (1A) power to fix a maximum amount will be exercised with respect to any particular form of hospital treatment. Instead, the scheme assumes that the measure in subs (1) (“the cost to the hospital”) will apply unless the subs (1A) power is exercised.
Fifthly, s 62(1A) operates to give effect to any order made in the exercise of that power. Assuming that the s 62(1A) power has been validly exercised, the application of s 62(1A) in a given case involves the following steps.
It is first necessary to identify the “particular hospital treatment” in question, that is, the treatment for which the employer is liable under s 60(1). In the present case, that was the Shoulder Prosthesis.
It is then necessary to determine whether any order published in the Gazette made in the exercise of the s 62(1A) power fixes a maximum sum “in respect of that treatment”. For this purpose the order may, but need not, specifically single out the “particular … treatment” in question. Provided that the order fixes a maximum sum “in respect of that treatment”, for example, by describing a class of treatments within which the “particular … treatment” falls, s 62(1A) will operate to limit the employer’s liability to that sum.
The second of those steps turns on the construction of the s 62(1A) order. That is the central issue in the present case.
“Surgical prostheses are to be selected from the Department of Health Prostheses List (in accordance with the Private Health Insurance (Prostheses) Rules (Cth) rate current at the time of service) at the minimum benefit rate.”
It is common ground that the Prostheses List to which cl 8(1) refers is the list found in the Schedule to the Private Health Insurance (Medical Devices and Human Tissue Products) Rules (No. 1) 2023 (Cth) (Commonwealth Rules). The Court was informed that that instrument runs to somewhere in the order of 1,500 printed pages. The Prostheses List is highly specific in identifying particular “surgical prostheses” by, apparently, the particular supplier and model. For each prosthesis, the Prostheses List identifies a “minimum benefit” expressed in dollars.
It is also common ground that the Shoulder Prosthesis is not on the Prostheses List.
On Qantas’ case, the key words in cl 8(1) are: “Surgical prostheses are to be selected from the … Prostheses List” (emphasis supplied).
Qantas acknowledges that one reading of the words “are to be selected” is that they constitute a command to select prostheses only from the Prostheses List. Expressed negatively, that command would amount to a prohibition on selecting a prosthesis other than from the Prostheses List. Qantas acknowledges that the power in s 62(1A) to issue the Order would not authorise a command or prohibition of that kind.
However, Qantas submits that there is an alternative reading of the words “are to be selected” which would not be beyond power and which should therefore be preferred. Qantas argues that the words “are to be” have a “mandatory force” which must be given some effect. The effect for which Qantas contends was expressed by its Senior Counsel as follows in oral argument: “if you want an amount it has to be from this list and it will be the amount specific on the list”: Tcpt 30 April 2026 at 16.12; emphasis supplied.
On Qantas’ case, the words “are to be selected from” have a great deal of work to do; indeed, too much. On Qantas’ construction, those words perform two distinct functions.
First, with respect to any prostheses that are identified in the Prostheses List, the words “are to be selected from” operate to fix, as the maximum amount for which an employer is liable, the amount specified as the minimum benefit in the Commonwealth Rules.
Secondly, with respect to any prostheses that are not identified in the Prostheses List, the same words also operate to fix, as the maximum amount for which an employer is liable, an amount of nil.
Neither proposition has an express textual foundation in cl 8(1) itself. There is no language expressly referring to the employer’s liability; nor capturing the notion of a maximum amount; nor of an amount of zero.
As to the first proposition, it is true that the Order expressly states that it was made “pursuant to section 62(1A) of the [1987] Act”, which is a power to fix maximum amounts. It is also true that cl 3 of the Order states that it “sets the maximum fees for which an employer is liable under the [1987] Act for any treatment provided by a Private Hospital with respect to an injured worker.” In light of that contextual material, it is open to read cl 8(1) as providing that where a prosthesis is “selected from the … Prostheses List”, the maximum amount of the employer’s liability pursuant to s 60(1) of the 1987 Act with respect to that prosthesis will be the amount of the corresponding “minimum benefit” in the List. That aspect of the construction of cl 8(1) was not in contest.
“… when it comes to considering the centrally relevant words to be interpreted, I accept that the less clear they are, or, to put it another way, the worse their drafting, the more ready the court can properly be to depart from their natural meaning. That is simply the obverse of the sensible proposition that the clearer the natural meaning the more difficult it is to justify departing from it. However, that does not justify the court embarking on an exercise of searching for, let alone constructing, drafting infelicities in order to facilitate a departure from the natural meaning. …”
There is no need to construct drafting infelicities in the present case. Even apart from the obscurity of cl 8(1) itself, the Order is far from a model of drafting in the exercise of the s 62(1A) power. For example:
Clause 3 states: “This Order applies to the hospital treatment of a worker at a private hospital, being treatment of a type referred to in clause 5 …”. But cl 5 does not clearly refer to any particular “type” of treatment.
Clause 5(1) then states: “An employer is not liable under the Act to pay any amount for hospital treatment provided to a worker at a facility that is not a public hospital or a private hospital as defined.” But cl 3 has already told the reader that the Order applies to treatment “at a private hospital”. It is wholly unclear why cl 5(1) is referring to what occurs at facilities to which the Order does not apply.
Moreover, whether or not the statement about liability in cl 5(1) is correct is a matter of construction of the 1987 Act, and in particular s 60. The s 62(1A) power is a power to fix a maximum sum for which an employer is liable in respect of hospital treatments. It is no part of the exercise of that power to make general statements about liability; indeed, the statement here appears to be in the nature of a practical warning.
Another example is the list of definitions in cl 4. Included within the definition of “Intensive care (level 1 or level 2)” are operative provisions regulating the basis upon which invoicing for intensive care services is to take place.
That being so, the Court should not be constrained by the natural and ordinary meaning of a phrase which should not have been used in the first place — at least where there is an available construction which gives the clause some sensible work to do that is compatible with the words chosen. That approach is consistent with the line of cases to which Qantas itself referred, which encourage a practical approach to construing instruments made under statute: see Gill v Donald Humberstone & Co Ltd [1963] 3 All E.R. 180; [1963] 1 WLR 929 at 934; Environment Protection Authority v Orchard Holdings (NSW) Pty Ltd (in liq*)* (2014) 86 NSWLR 499; [2014] NSWCA 149 at [44]–[45]; Day v Harness Racing (NSW) (2014) 88 NSWLR 594; [2014] NSWCA 423 at [79]–[81].
Thirdly, there is such a construction available, particularly when one reads cl 8(1) as a whole. Qantas’ argument overlooks the closing words of cl 8(1): “Surgical prostheses are to be selected from the … Prostheses List … at the minimum benefit rate.” It is open to read the words “are to be” as mandating not the selection of prostheses from the List, but rather the applicable (ie, maximum) “rate”. The force to be given to the words “are to be” is that when a “[s]urgical prosthes[i]s” is “selected from the … Prostheses List”, the selection is “at the minimum benefit rate”.
“The presidential member failed to otherwise enter an award pursuant to s.60 of the [1987 Act] for left shoulder pyrocarbon hemi-arthroplasty and associated expenses.”
In light of the conclusions reached above, the appeal must be allowed pursuant to that ground. The parties provided an agreed form of order to the Court addressing that result.
Ground 1 is:
“The presidential member failed to hold that the [Order] is ultra vires its parent act, the [1987 Act].”
In light of the conclusion reached above as to the proper construction of cl 8(1), this ground, which was premised on a different construction of the Order and was in effect an alternative ground of appeal, falls away.
The remaining issues also fall away. These include determining what would have been the appropriate form of relief if Mr Bishop’s argument under Ground 1 (that the Order was beyond the power in s 62(1A)) had succeeded. Those matters do not arise for consideration and were not fully argued in any event.
Among the issues which it is not necessary to decide are various questions of construction of the 1987 Act upon which the parties only touched in argument and which had, at most, a tangential contextual relevance to construction of the Order. One such question is whether, when s 60A(b) provides, in the case of hospital treatment at a hospital, that a worker is not liable to pay any amount in excess of the applicable maximum “calculated as fixed under section 62(1) as the cost to the hospital of the treatment”, the reference to s 62(1) should be understood as being subject to s 62(1A). Consideration of that question should await a case in which it is necessary to decide it.
The general rule is that costs follow the event: Uniform Civil Procedure Rules 2002 (NSW), r 42.1. In the absence of submissions on that issue, I would propose an order that Qantas pay Mr Bishop’s costs.
However, in circumstances where the argument on which Mr Bishop succeeded was not fully articulated before the hearing of the appeal, and leave was given at the hearing to revive Ground 2 (which Mr Bishop had earlier abandoned) in order for him to advance that argument, Qantas indicated at the hearing that in the event that Mr Bishop succeeded, it might wish to be heard as to costs.
It is appropriate in the circumstances to give Qantas seven days in which to decide whether to make, and if so to file and serve, any submissions as to whether some other order should be made as to costs.
The appeal should be allowed, and the determination of Senior Member Haddock restored.
I propose the following orders, the first three of which are based on those the parties agreed would be appropriate in the event that Mr Bishop succeeded.
Appeal allowed.
Orders of Deputy President Snell dated 21 July 2025 are set aside.
In lieu thereof, the Certificate of Determination dated 16 December 2024 is confirmed.
In the event that the respondent does not exercise the liberty referred to in Order 5 within 7 days of the date of these orders, order the respondent to pay the appellant’s costs.
Grant liberty to the respondent to file and serve within 7 days of the date of these orders any written submissions it wishes to make as to costs, such submissions not to exceed 4 pages in length.
In the event that the respondent files submissions pursuant to Order 5, direct the appellant to file and serve within 14 days of the date of these orders responsive submissions in writing not exceeding 4 pages in length.
Any question of costs arising out of Orders 5 and 6 be determined on the papers.
FREE JA: I agree with McHugh JA.
**********
Bishop
Qantas Airways Ltd
Appeal allowed. The orders of Deputy President Snell dated 21 July 2025 were set aside, and the Certificate of Determination dated 16 December 2024 was confirmed. Costs were subject to the submissions process set out in orders 4 to 7: [60].
It is much more difficult to find a textual basis in cl 8(1) (or elsewhere in the Order) for the second proposition. The text gives no indication of the consequence if a surgical prosthesis is not “selected from the … Prostheses List”; the text is not directed to that circumstance at all. In particular, nothing in the text states that the consequence is that the amount for which the employer is liable is nil. A liability of nil amounts to no liability at all. Given that s 62(1A) is directed to the quantification, rather than the existence, of liability, it would be surprising if cl 8(1), made pursuant to s 62(1A), had the blanket effect of relieving the employer of the liability that s 60(1) had already imposed. It would be still more surprising if that were the meaning of the words, “are to be selected from”.
Nevertheless, Qantas submits that some meaning must be given to the words “are to be”; that those words have a mandatory force, which must be given effect; and that the meaning is relevantly as set out above. That argument should not be accepted.
First, it should be noted that the mandatory force of the words “are to be” is qualified even in Qantas’ formulation, which began with the words, “if you want an amount”. There is a significant tension between those words, which are not express in the text of cl 8(1), and the role of s 62 in the basic legislative scheme. The words “if you want an amount” imply that unless the condition (that the prosthesis “has to be from this list”) is satisfied, the employer will have no liability to pay the cost of treatment. To construe the words “are to be selected” in that way in effect makes the Order the source of an employer’s statutory liability. But neither s 62, nor any order made under s 62(1A), creates an employer’s statutory liability to pay the cost of the hospital treatment. By operation of s 60(1), the employer’s liability already exists. As noted above, s 62(1) and (1A) acknowledge that liability and are directed only to its quantification.
Secondly, to the extent that Qantas insists that the words “are to be selected from” must be given a meaning conveying their natural and ordinary mandatory force, and that what is mandatory here is selection from the List (“if you want an amount it has to be from this list”: Tcpt 16.12), the proposition should not be accepted. The use of the words “are to be” in cl 8(1) is obscure. The natural and ordinary meaning of those words bears no relation to the structure of the statutory scheme or to the source of the power in s 62(1A) pursuant to which the Order was made. In particular, the notion of any form of mandatory selection is alien to s 62.
The observations of Lord Neuberger (with whom Lords Sumption and Hughes agreed) in Arnold v Britton [2015] AC 1619; [2015] UKSC 36 are apposite. That was a case about the proper approach to contractual interpretation. His Lordship said at [18]:
That is the construction to be given to cl 8(1). On that construction, the clause says nothing about hospital treatments which are not on the Prostheses List. That construction gives all of the clause’s language work to do; is consistent with the exercise of the power in s 62(1A); and is also consistent with the words “(if any)” in that section. That is to say, it is entirely consistent with s 62(1A) that there may be hospital treatments for which the Order does not fix a maximum amount quantifying the employer’s liability.
This construction of cl 8(1) is also consistent with the Order’s very different use of language, in other clauses, to convey that a nil amount (ie, no additional amount) is payable with respect to some aspect of a hospital treatment. When the Order sets out to do so, it uses much more direct language than that found in cl 8(1). The clearest example is cl 10, which simply states: “There is no additional fee payable for a single room.” Clause 5(3) similarly says, “The theatre fees include the costs of consumable and disposable items. Only in exceptional circumstances will additional fees be paid for high-cost consumable and disposable items on provision of evidence from the hospital that the item is reasonably necessary.”
In light of this construction, cl 8 is simply not directed to the Shoulder Prosthesis. The Order therefore does not fix a maximum amount for which Qantas is liable for the Shoulder Prosthesis.
In the result, pursuant to ss 60(1) and 62(1), the amount for which Qantas is liable in respect of the Shoulder Prosthesis is the cost to the hospital of that treatment.