Bosch v McCain Foods

Supreme Court of NSW|2019-06-20|Before: Simpson AJ

Texts Cited: American Medical Association's Guides to the Evaluation of Permanent Impairment Permanent Impairment Guidelines, cl 7.14 Workers Compensation Guidelines Category: Principal judgment Parties: Noelle Bosch (Plaintiff) McCain Foods (Australia) Pty Ltd (First Defendant) Workers Compensation Commission of NSW (Second Defendant) The Medical Appeal Panel of the Workers Compensation Commission of NSW (Third Defendant) Representation: Counsel: D J Hooke SC/E E Grotte (Plaintiff) P Perry (First Defendant) Submitting Appearance (Second and Third Defendants)

Solicitors: Santone Lawyers (Plaintiff) Hicksons (First Defendant) Crown Solicitor's Office (Second and Third Defendants) File Number(s): 2019/59854 Decision under appeal Court or tribunal: Workers Compensation Commission Date of Decision: 23 November 2018 Before: Arbitrator Grahame Edwards; Approved Medical Specialists Dr Phillippa Harvey-Sutton and Dr Edward Korbel File Number(s): M1-2220/18

Applicable legislation

In general terms, the Workers Compensation Act 1987 (NSW) ("the WC Act") prescribes the compensation entitlements of persons who suffer "injury", relevantly defined in s 4(a) as "personal injury arising out of or in the course of employment" (to which I will refer in these reasons as "work injury"). The Workplace Injury Management and Workers Compensation Act 1998 (NSW) ("the WIM Act") (inter alia) prescribes the means by which those entitlements are to be determined. Each Act is to be construed with, and as if it formed part of, the other: WC Act, s 2A, WIM Act s 60(2). For the purposes of administration, the Workers Compensation Commission of NSW ("the Commission") is established by s 366 of the WIM Act. By s 368 of the WIM Act the Commission consists of a President, Deputy Presidents, a Registrar and Arbitrators, appointed by the relevant Minister.
By s 17 of the State Insurance and Care Governance Act 2015 (NSW) the State Insurance Regulatory Authority ("the Authority") is constituted. By s 24 a number of functions are conferred on the Authority, including, relevantly, such functions as are, in turn, conferred on it by or under the WC Act or the WIM Act.
By s 9 of the WC Act a worker who receives a work injury is entitled to receive, from his or her employer, compensation as otherwise provided in various provisions of the WC Act. The benefits are spelled out in Pt 3 and include weekly compensation by way of income support (Div 2), compensation for the costs of medical, hospital and rehabilitation treatment made "reasonably necessary" "as a result of" the work injury (Div 3, esp s 60(1)), and limited lump sum compensation for permanent impairment (Div 4). Where the work injury results in a degree of permanent impairment greater than 10%, the compensation includes specific lump sum compensation calculated on a sliding scale depending on the degree of permanent impairment (s 66). By s 65(1) the degree of permanent impairment is to be assessed in accordance with Ch 7, Pt 7 of the WIM Act, to which I will come.
Part 5 of the WC Act deals with the limited common law remedies that remain available to workers who suffer work injuries. Specifically, by s 151H(1), no damages at common law may be awarded unless the work injury results in the death of the worker or a degree of permanent impairment that is at least 15%. By subs (4) the degree of permanent impairment is to be assessed as otherwise provided by s 151H, and by Ch 7, Pt 7 of the WIM Act.
By s 313 of the WIM Act, where there is a dispute about whether the degree of permanent impairment resulting from the work injury is sufficient for an award of common law damages (that is, at least 15%), no court proceedings may be commenced unless the degree of permanent impairment has been assessed under Ch 7, Pt 7 of the WIM Act.
By s 105(1) of the WIM Act, but subject to some specific exceptions, the Commission has exclusive jurisdiction to examine, hear and determine all matters arising under either the WC Act or the WIM Act. By s 350, except as otherwise provided, decisions of the Commission are final and binding and not subject to review. By way of exception to s 350, a limited right of appeal (to the Commission constituted by a Presidential member) is permitted (s 352). By s 375(1) the Commission is to be constituted by an Arbitrator appointed under the WIM Act, except where the proceeding is an appeal, in which case it is constituted by a Presidential member (subs (3)).
By s 293 of the WIM Act where a dispute referred to the Commission for determination concerns a "medical dispute" (as defined, and referred to below) the Registrar may, subject to any relevant regulations with respect to the assessment of permanent impairment, refer the dispute for medical assessment under Ch 7, Pt 7 of the WIM Act.
Chapter 7 of the WIM Act is concerned with "New claims procedures". Part 7 of Ch 7 (ss 319-331) makes specific provision for the assessment of medical disputes. "Medical dispute" is defined in s 319 as a dispute about a number of issues which, relevantly, include: "(a) the worker's condition (including the worker's prognosis, the aetiology of the condition, and the treatment proposed or provided), and … (c) the degree of permanent impairment of the worker as a result of an injury …"
By s 320 the President of the Commission is (in accordance with criteria developed by the relevant Minister) to appoint medical practitioners to be "approved medical specialists" ("AMS") for the purposes of Pt 7. The function of AMS's is the assessment of medical disputes.
By s 376 the Authority may issue guidelines with respect to a number of specified matters (including, expressly, the assessment of the degree of permanent impairment of an injured worker as a result of a work injury). By s 377(2) such guidelines are to be developed in consultation with relevant medical colleges. The Authority has in fact issued guidelines with respect to the assessment of permanent impairment ("the Permanent Impairment Guidelines").
By s 321(1) a medical dispute (other than a dispute concerning permanent impairment of an injured worker) may be referred by a court, the Commission or the Registrar, either of their own motion or at the request of a party, for assessment under Pt 7. By subs (2) of s 321 the medical dispute is to be referred to an AMS, nominated either by agreement between the parties, or, in default of agreement, by the Registrar. (The exclusion of a dispute concerning permanent impairment is, no doubt, because provision for such assessment is independently made by s 65 and s 151H(4) of the WC Act. There is no occasion for referral by any of the entities mentioned.) By s 322(2) of the WIM Act the assessment of the degree of permanent impairment that results from a work injury is to be made in accordance with Workers Compensation Guidelines in force at the time of the assessment.
By s 325 the AMS is to give a certificate ("a medical assessment certificate") as to the matters referred for assessment. By s 326(1) a medical assessment certificate is conclusively presumed to be correct in any proceedings before a court or the Commission in a matter with which the certificate is concerned.
Notwithstanding the terms of s 326, s 327 provides for a limited right of appeal from a medical assessment certificate issued by an AMS under s 325. A party to a medical dispute may apply to the Registrar to appeal against a medical assessment, but only on "grounds for appeal" provided in subs (3). Those grounds are: "(a) deterioration of the worker's condition that results in an increase in the degree of permanent impairment, (b) availability of additional relevant information (but only if the additional information was not available to, and could not reasonably have been obtained by, the appellant before the medical assessment appealed against), (c) the assessment was made on the basis of incorrect criteria, (d) the medical assessment certificate contains a demonstrable error." An appeal is not to proceed unless the Registrar is satisfied that at least one of the subs (3) grounds has been "made out" (s 327(4)).
By s 328(1) an appeal, if allowed to proceed, is to be heard by an Appeal Panel constituted by two AMS's and one Arbitrator chosen by the Registrar. By subs (2) the appeal is to be by way of review of the original medical assessment, but limited to the "grounds of appeal" on which the appeal is made. By subs (3) evidence additional to that before the AMS may not be given unless it was not, and could not reasonably have been, available at the time of the medical assessment. By subs (5) the Appeal Panel may confirm the certificate of assessment of the AMS, or may revoke the certificate and issue a new certificate as to the matters concerned. A new certificate issued under s 328(5) is, by s 326(1), conclusively presumed to be correct in any proceedings before a court or the Commission in a matter with which the certificate is concerned.
By s 331 medical assessments and appeals from medical assessments are subject to the relevant provisions of Workers Compensation Guidelines issued under s 376 of the WIM Act.
The relevant Permanent Impairment Guidelines were issued by the Authority on 1 April 2016. As a general proposition, but subject to some deviation, they adopt the 5th edition of the American Medical Association's Guides to the Evaluation of Permanent Impairment ("AMA5"). Relevantly for present purposes, the Permanent Impairment Guidelines make some modification to the AMA5 assessment of permanent impairment of the urinary and reproductive systems. With reference to female infertility, cl 7.14 states that: "… a woman in the childbearing age is infertile when she is unable to conceive naturally" and instances a number of circumstances that might bring about that result. The Permanent Impairment Guidelines provide specifically for the assessment of female infertility. Table 7.5 sets out the criteria for rating permanent impairment due to fallopian tube and ovarian disease. Class 3 of Table 7.5 states that certain conditions, including infertility, should be assessed as constituting 26-35% impairment of the whole person.

Factual background

To a large extent the factual background is not in dispute.
From about 2005 the plaintiff was employed by McCain Foods as a production worker. On 24 March 2015, in the course of her employment, she lifted a box of pies and experienced sudden severe back pain as well as painful symptoms in her pelvic region. She was referred by her general practitioner to Dr Jane Manning, a urogynaecologist. Dr Manning diagnosed vaginal prolapse and bladder hypersensitivity. She advised the plaintiff that she could undergo repair, or could combine the repair with hysterectomy. The latter course, Dr Manning advised, would give a better operative result and reduce the risk of recurrence. Thereafter, Dr Manning provided a number of reports to the plaintiff, to her solicitors, to her general practitioner, and to EML.
On 2 September 2015 Dr Manning reported to EML, recommending surgery, which she explained as: "Prolapse surgery would be anterior repair, posterior repair, vaginal hysterectomy, sacrospinous colpopexy and cystoscopy …" (italics added) The plaintiff accepted Dr Manning's advice and decided to proceed with both the repair and the hysterectomy. She made a claim for compensation under s 9 of the WC Act, specifically claiming, under s 60, compensation for the cost of medical and hospital treatment. EML disputed the claim, relying on a report of Dr John Schmidt (a Consultant Obstetrician and gynaecologist), of 20 September 2015. Dr Schmidt accepted Dr Manning's opinion that the plaintiff required vaginal repair surgery and noted Dr Manning's proposed treatment, including hysterectomy, but did not agree that the lifting episode in the workplace was responsible for the prolapse. Dr Schmidt made no comment on the proposal to include hysterectomy in the surgery.
On 21 March 2016 Dr Manning reported to the plaintiff's solicitors, stating her diagnosis as: "Hypersensitive poorly compliant bladder and a symptomatic prolapse." Under the heading "Need for further treatment" Dr Manning wrote: "There may well be a need for long term medical therapy for bladder hypersensitivity and urinary urgency. This is difficult to predict. Prolapse surgery may have lasting success if she can maintain normal BMI, avoid heavy lifting in any context, continue pelvic floor exercises, refrain from smoking and avoid constipation. Further prolapse surgery might be required over time regardless …"
It is to be noted (for future reference) that, in this report, Dr Manning did not repeat the recommendation for surgery that she had previously made in her report to EML. Indeed, in this report, she did not make any recommendation for immediate surgery. The report was primarily directed to the cause of the plaintiff's prolapse; the part of her report extracted above was directed to any potential future need for treatment. Read in context, that part of the report proceeded on the assumption that the surgery proposed in the 2 September 2015 report would be performed.
The plaintiff's claim was referred to an Arbitrator of the Commission. Dr Manning's reports of 2 September 2015 and 21 March 2016 (and many others) were before the Arbitrator. A great deal of other material was also before the Arbitrator, including a statement by the plaintiff in which she said that she found her infertility "devastating". On 12 September 2016 the Arbitrator ordered: "The respondent [McCain Foods] will pay for the cost of the surgical treatment as proposed by Dr Jane Manning in her report of 21 March 2016."
The Arbitrator's reasons for the determination are not available. Any disputed issues before the Arbitrator have not been identified for the purposes of this application. It is inherent in the determination that the Arbitrator accepted that the surgery to which he referred was "reasonably necessary" as a result of the plaintiff's work injury: see WC Act s 60. There was no appeal from the Arbitrator's determination.
On 24 October 2016 Dr Manning provided to the plaintiff an estimate of the costs of the proposed surgery. The estimate was (I was told, during the course of the hearing, without demur - T51) sent to EML. The estimate provided for four separate procedures, in respect of each of which a specific fee was identified. One of the procedures was vaginal hysterectomy. The surgery was performed on 3 November 2016. Pursuant to the order of the Arbitrator, EML met the entirety of the estimated costs, including the component specifically attributable to the hysterectomy. The plaintiff was then 43 years old, of childbearing age, and, prior to the surgery, of childbearing capacity. The surgery resulted in permanent loss of fertility.
The plaintiff then claimed, pursuant to s 66 of the WC Act, compensation for permanent impairment. The permanent impairment she claimed was loss of fertility occasioned by the hysterectomy. Loss of fertility is expressly recognised in the Permanent Impairment Guidelines.
EML disputed liability. On 2 May 2018 the plaintiff filed in the Commission an Application to Resolve a Dispute. She sought referral for medical assessment by an AMS of the degree of permanent impairment resulting from her work injury for the purposes of both s 66 (being lump sum compensation for permanent impairment) and s 151H of the WC Act (a claim for damages at common law), in each case where the degree of permanent impairment was in dispute. She identified permanent impairment to her lumbar spine, and, relevantly, to her urinary and reproductive systems as the basis for her claim. Her claim for assessment of the degree of permanent impairment to her lumbar spine has been separately dealt with and is of no further relevance.
Claims for assessment under s 65(1) and s 151H(4) of the WC Act involved two components: whether the worker suffers any permanent impairment, and, if so, to what degree; and whether any such permanent impairment results from the work injury, and, if so, to what extent. The issues involved in the plaintiff's claim were narrow. Her claim was for assessment of the degree (not the fact) of permanent impairment. That she had lost fertility was not, and could not have been, in dispute. The immediate cause of the infertility was the hysterectomy. Nor could there have been any serious dispute that the assessment would have exceeded 10%, and, for the purposes of s 151H, 15%. That follows from the application of the Permanent Impairment Guidelines, which call for assessment of loss of fertility as between 26% and 35%. The sole remaining question was whether the hysterectomy, and hence the permanent impairment, resulted from the work injury.
The AMS concluded that it did not.

The reasons of the AMS - the medical assessment certificate

In accordance with s 321 of the WIM Act the plaintiff's claim was referred to Dr Michael Rochford ("the AMS"), who conducted an examination of the plaintiff and took a history. The only record of the examination and history before this Court is that to be found in the Reasons for the assessment. Although he considered that there would have been other contributing factors (that the plaintiff had had two full-term pregnancies with normal deliveries) the AMS accepted (contrary to Dr Schmidt's view) that the vaginal prolapse resulted from the lifting incident at work on 24 March 2015. He recorded the plaintiff's history that she had accepted Dr Manning's advice to undergo the hysterectomy in order to reduce the chance of recurrence of the vaginal prolapse. However, he did not accept that the loss of fertility was "a problem for assessment". By this he appears to have intended to convey that the loss of fertility did not result from the work injury. This was because he considered that the hysterectomy was "elective". He said: "If preservation of fertility was a priority, then a repair of her prolapse by anterior and posterior repair without hysterectomy was an option. Ms Bosch states that Dr Manning did discuss this option indicating that the hysterectomy in conjunction with vaginal repair gave a better operative result. Also, from the GP notes (May 14 2015) Ms Bosch was having heavy menstrual periods with clots (Menorrhagia) in the weeks prior to her initial assessment by Dr Manning. This problem plus her age group may have been factors in the ultimate decision to undergo vaginal repair plus hysterectomy."
On 26 July 2018, pursuant to s 325 of the WIM Act, the AMS determined the plaintiff's whole person impairment with respect to her "Urinary Reproductive System" as 1%, and issued a medical assessment certificate to that effect.

The application to appeal

Pursuant to s 327 of the WIM Act, the plaintiff applied to the Registrar to appeal against the AMS's determination. The form prescribed for such an application requires identification of the "grounds of appeal" by reference to the available "grounds for appeal" specified in s 327(3). The plaintiff identified "incorrect criteria" and "demonstrable error" (that is, grounds 3(c) and (d)) as the grounds on which she sought to appeal.
On the plaintiff's behalf submissions were made in support of the application. Relevantly, it was said: "17. The proposed surgery as recommended by Dr Jane Manning included the hysterectomy. It was determined to be reasonably necessary as a result of the work injury by an Arbitrator. The legal and factual matters had been appropriately determined by the Arbitrator, and it was the task of the AMS to determine the degree of permanent impairment resulting from the injury, which had already been determined. 18. The use of the word 'elective' by the AMS indicates that he misunderstood his task and that he misunderstood the legal concept of causation and the test for 'results from', which had already been determined by the Arbitrator. The hysterectomy only occurred because of the compensable injury. The surgery was recommended to Ms Bosch by her treating surgeon. There is no evidence that she would have had a hysterectomy had she not suffered the workplace injury and the vaginal prolapse. The reason Ms Bosch has had her uterus removed is because she sustained an injury at work, and as a consequence, she is now infertile, which she has described as 'devastating'. 18. The AMS was therefore required to apply the correct criteria in accordance with the applicable guidelines … 20. The AMS incorrectly failed to carry out the assessment because in his opinion the surgery for the hysterectomy, which caused the infertility, was 'elective' and for reasons other than the injury. The process of reasoning discloses the error as the AMS has based his conclusions on questions of causation, which have already been determined by the Arbitrator and are not within his purview. The AMS's findings on causation were inconsistent with the referral and with the Arbitrator's determination and the Certificate of Determination issued on 12 September 2016. …"
EML filed a Notice of Opposition to the plaintiff's application and also provided submissions in support. Relevantly, EML submitted: "2.3 It is not disputed that it was not for the AMS to determine the hysterectomy performed on November 2016 was reasonably necessary as a result of the work injury on 24 March 2015. 2.4 The respondent contends, however, that a reading of the AMS's decision as a whole makes clear that the AMS was intending to convey that any impairment relating to the appellant's infertility was not attributable to the work injury on 24 March 2015. [It is difficult to reconcile these two paragraphs] 1.1 The AMS goes on to reason that the appellant had before her a choice at the time of her election to undergo surgery, one of those choices being to allow her to maintain her fertility. He reasons that if preservation of fertility was a priority, then a repair of the appellant's prolapse by anterior and posterior repair without hysterectomy would have been the preferable option. The AMS goes on to note that that [sic] the appellant's age (43 years) and pre-existing Menorrhagia may have influenced the ultimate decision to undergo the hysterectomy. 1.2 Accordingly, the respondent submits that the AMS has adequately 'explained the actual path of reasoning in sufficient detail to enable the Court to see whether the opinion does or does not involve any error of law. (see Wingfoot Australia Partners Pty Ltd v Kocak [2013] HCA 43). 1.3 In these circumstances, it is submitted that it was reasonable for the AMS to attribute the applicant's loss of fertility to non-work related factors, even if the surgery leading to such was reasonably necessary as a result of the work injury." (italics in original) [The peculiar numbering system is that of the written submissions.]
If separate submissions were provided to the Appeal Panel, they are not in evidence on this application. I will assume that the submissions in support of, and in opposition to, the application for an appeal were the submissions put to the Appeal Panel.
Pursuant to s 327(4) of the WIM Act, the Registrar referred the plaintiff's application to an Appeal Panel. There is no indication of which of the grounds advanced by the plaintiff the Registrar found to have been "made out".

The reasons of the Appeal Panel

The Appeal Panel conducted a preliminary review of the medical assessment by the AMS in the absence of the parties and determined that further medical examination was unnecessary because the appeal could be determined on the documentary evidence and the submissions of the parties. It had available to it all of the documentary material that was before the AMS, as well as the submissions in support of, and opposition to, the appeal. On 23 November 2018 the Appeal Panel confirmed the determination of the AMS, giving reasons.
The Appeal Panel set out concisely the background to the appeal and recorded the submissions made by the parties. It then moved to a section of its decision headed "Findings and Reasons". It referred to the Arbitrator's orders and to Dr Manning's report of 21 March 2016 which, it observed, contained no indication that the proposed surgery included a hysterectomy. Just what the Appeal Panel made of this omission is not stated.
One construction of this observation is that the Appeal Panel thought that the absence of reference to hysterectomy in the 21 March report was an indication that Dr Manning did not consider that procedure necessary as a result of the work injury. But it is an incomplete observation. A more accurate observation would have been that while there was, in the 21 March report, no reference to any proposed surgery, there was explicit reference to the hysterectomy in Dr Manning's report of September 2015, in which all the surgery proposed, including the hysterectomy, was itemised.
As senior counsel for the plaintiff said, the Appeal Panel, to a large extent, adopted the findings and reasoning of the AMS. It expressly repeated his observations about the plaintiff's opportunity, had fertility been a priority, to decline the hysterectomy, and it expressly repeated the observation about the plaintiff's Menorrhagia ([49]-[50]). And it confirmed and recorded the finding of 1% whole person impairment resulting from the infertility.
The Appeal Panel placed significant weight on the manner in which the Arbitrator's finding was expressed, in particular his order that McCain Foods pay "for the cost of surgical treatment as proposed by Dr Jane Manning in her report of 21 March 2016", noting that no recommendation for hysterectomy had been made in that report. The Appeal Panel expressly found that the lifting of the box of pies on 24 March 2015 caused the vaginal prolapse, but was not satisfied that the subsequent hysterectomy which, in turn, resulted in infertility, "only occurred because of the compensable injury". The Appeal Panel referred extensively to the findings and observations of the AMS.
The Appeal Panel said: "51. The AMS's conclusion that the loss of fertility as a result of the hysterectomy was not one for assessment of permanent impairment resulting from the injury was based upon his medical knowledge and judgment. … 53. The Appeal Panel is unable to accept the appellant's submission that the need for the hysterectomy 'only occurred because of the compensable injury'. 54. While Dr Manning in her letter of 2 September 2015 to [EML] referred to the proposed surgery which included a hysterectomy, she stated that 'correcting the prolapse' would allow the appellant to return to her previous duties with the respondent. … 57. The Appeal Panel agrees with the conclusion reached by the AMS for the reasons he gave that the appellant elected to undergo the hysterectomy plus the repair rather than undergo the anterior and posterior vaginal repair to cure the prolapse. 58. The AMS's finding that the hysterectomy was not as a result of the work injury was a medical conclusion based upon medical knowledge and judgement with which the Appeal Panel concurs. 59. The Appeal Panel finds the AMS's assessment was not made on the basis of incorrect criteria, and that the [medical assessment certificate] does not contain a demonstrable error."
It may be observed that, at [54], the Appeal Panel misstated the clear terms of Dr Manning's report. Far from indicating that the prolapse surgery would allow the plaintiff to return to her previous duties, Dr Manning said: "2. Correcting the prolapse that [the plaintiff] currently suffers would not allow her to return to her previous duties with the regular heavy lifting entailed as a process worker with McCain foods."
The Appeal Panel confirmed the determination of the AMS. It is that decision that is the subject of the present application for judicial review.

The application for judicial review

By her amended summons the plaintiff seeks a declaration and one substantive order as follows: "1 A declaration … that the decision and the statement of reasons of the [Appeal Panel] is void and of no effect. 1A An order setting aside the decision and the statement of reasons of the [Appeal Panel] …"
She has specified two grounds for the application, as follows: "1. The [Appeal Panel] erred in law in finding that the permanent impairment to the plaintiff's urinary and reproductive system, being an impairment of the uterus … was not a result of the work injury the subject of assessment within the meaning of the [WC Act], s66(1). 1A. The [Appeal Panel] erred in law on the face of the record in failing to give adequate reasons for its decision, in that it failed to articulate the test of causation that it applied in determining whether the plaintiff's impairment caused by the hysterectomy 'resulted from the injury' the subject of assessment."

The nature of the s 69 jurisdiction

As noted above, relief under s 69 of the Supreme Court Act is available only in limited circumstances. The plaintiff must establish either jurisdictional error or error of law on the face of the record. The distinction is important, not least because, where jurisdictional error is asserted, evidence may be admitted for the purpose of establishing the error. Where error of law other than jurisdictional error is asserted, the material available for consideration is confined to what appears "on the face of the record". By subs (4) of s 69, "the record" includes the reasons for the decision; nevertheless, there is no certainty as to the boundaries of "the record" for the purposes of s 69: see Craig v The State of South Australia (1995) 184 CLR 163; [1995] HCA 58; AAI Ltd trading as GIO as agent for the Nominal Defendant v McGiffen [2016] NSWCA 229; (2016) 77 MVR 348; D'Ament v Allianz Australia Insurance Ltd [2019] NSWCA 201.
As is all too common in applications under s 69, little, if any, attention was paid to the nature or classification of the asserted errors. In written submissions filed on behalf of the plaintiff it was contended (at [22]), that the AMS "made a demonstrable error" by finding that the permanent impairment to the plaintiff's urinary and reproductive systems was not the result of the work injury of March 2015; and that the AMS: "28 … made a demonstrable error by asking himself the wrong question, which was whether a part of the surgery was elective, rather than asking whether the procedure, which included the hysterectomy, was causally related to the work injury."
The AMS's conclusions that the hysterectomy aspect of the surgery was elective, and that, had her fertility been a priority for the plaintiff, she would not have proceeded with that part of the surgery were, it was contended, contrary to the evidence, and contrary to the advice given to the plaintiff by Dr Manning.
"Demonstrable error" is, by s 327(3) of the WIM Act, one of the avenues that open the way to an appeal to an Appeal Panel from an AMS assessment. It is not, of itself, sufficient to open the way to judicial review under s 69 of the Supreme Court Act. Moreover, it is difficult to see that the first asserted "demonstrable error" as stated in par [22] (Ground 1 of the application) and the contentions in par [24] of the plaintiff's written submissions are other than asserted errors of fact. To the extent that the submission may be interpreted as asserting an error of law, it is difficult to see how it differs from the second asserted error. I am prepared to read the second formulation, which posits that the AMS directed his attention to the wrong question, as an assertion of constructive failure to exercise jurisdiction, and hence, axiomatically, jurisdictional error. What is encompassed in a constructive failure to exercise jurisdiction was comprehensively stated by Jordan CJ in Ex parte Hebburn Ltd; Re Kearsley Shire Council (1947) 47 SR (NSW) 416 at 420. His Honour said: "… I quite agree that the mere fact that a tribunal has made a mistake of law, even as to the proper construction of a statute, does not necessarily constitute a constructive failure to exercise jurisdiction … But there are mistakes and mistakes; and if a mistake of law as to the proper construction of a statute investing a tribunal with jurisdiction leads it to misunderstand the nature of the jurisdiction which it is to exercise, and to apply 'a wrong and inadmissible test' … or to 'misconceive its duty,' or 'not to apply itself to the question which the law prescribes' … or 'to misunderstand the nature of the opinion which it is to form' … in giving a decision in exercise of its jurisdiction or authority, a decision so given will be regarded as given in a purported and not a real exercise of jurisdiction, leaving the jurisdiction in law constructively unexercised, and the tribunal liable to the issue of a prerogative writ of mandamus to hear and determine the matter according to law …" (internal citations omitted, italics added)
That passage was said by Gaudron J in Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57; [2001] HCA 22 (at [80]) to be "[t]he classic statement as to what constitutes constructive failure to exercise jurisdiction" and to have been approved by the High Court on numerous occasions.
In the light of par [28] of the plaintiff's written submissions and taking a somewhat benevolent approach, I interpret Ground 1 of the application as a contention of error of the kind explained in Hebburn.
Moreover, "[t]o fail to respond to a substantial, clearly articulated argument relying upon established facts" is, at least, a denial of procedural fairness: Dranichnikov v Minister for Immigration and Multicultural Affairs [2003] HCA 26; (2003) 77 ALJR 1088 at [24]. Failure to afford procedural fairness is jurisdictional error: Kirk v Industrial Court of New South Wales (2010) 239 CLR 531; [2010] HCA 1. That, too, may (with similar benevolence) be read into Ground 1.
Inadequacy of reasons (as is pleaded in Ground 1A of the application) is an error of law on the face of the record: Wingfoot Australia Partners Pty Ltd v Kocak (2013) 252 CLR 480; [2013] HCA 43 at [54]-[55].

Did the Appeal Panel fall into error?

It is now necessary to consider whether the Appeal Panel did fall into error of one or more of the kinds described.
In undertaking that task I do not overlook that each "demonstrable error" on which the plaintiff relied was attributed to the AMS, while the subject matter of the relief sought in the amended summons is the decision of the Appeal Panel. That is because, the plaintiff contends, the Appeal Panel substantially adopted and based its determination on the findings of the AMS.
Both s 66 and s 151H of the WC Act require a causal connection between the work injury and the permanent impairment to be established. Section 66 entitles a worker to lump sum compensation where the work injury "results in a degree of permanent impairment greater than 10%"; s 151H precludes an award of damages at common law unless the work injury "results in … a degree of permanent impairment of … at least 15%". The qualifying circumstance in each case is whether the permanent impairment "results from" the work injury.
Put succinctly and simply, the plaintiff's case advanced to the Appeal Panel assumed, in effect, a chain of causation - that the permanent impairment (infertility) resulted from the hysterectomy, which resulted from the prolapse surgery which in turn resulted from the work injury. Put in reverse, the work injury resulted in the need for prolapse surgery which resulted in the performance of the hysterectomy which in turn resulted in permanent impairment (infertility).
The main thrust of the argument put to the Appeal Panel was that neither the AMS nor the Appeal Panel had jurisdiction to determine causation, that issue having been concluded in the orders of the Arbitrator. It was submitted that: "the legal and factual matters had been appropriately determined by the Arbitrator". and that all that remained for the AMS, and the Appeal Panel, was to determine the degree of permanent impairment. (Curiously enough, EML, in the passage in its submissions quoted above ([36]) appeared to accept that the Arbitrator had made a binding and final decision on the question of causation.)
But the argument was disowned in the present application. It is contrary to authority: see Haroun v Rail Corporation New South Wales [2008] NSWCA 192; (2008) 7 DDCR 139 and Bindah v Carter Holt Harvey Woodproducts Australia Pty Ltd [2014] NSWCA 264; (2014) 13 DDCR 156.
In Haroun Handley AJA, with whom McColl JA and McDougall J agreed, pithily set out the division of functions of the Commission and the medical dispute assessment system. His Honour said: "16 … The scheme for the settlement of compensation disputes established by the [WIM Act] read with the [WC Act] is to have factual and legal issues resolved by an Arbitrator subject to an appeal to a President or Deputy President, and to have certain medical issues decided by an AMS subject to appeal to [an Appeal Panel]." That was echoed by Emmett JA, with whom Ward JA agreed, in Bindah, at [109].
In this case the determination made by the Arbitrator was as to the plaintiff's claim for compensation under s 9 of the WC Act for medical and hospital treatment made reasonably necessary as a result of the work injury.
That plainly involves a determination of a causal connection between the work injury and the medical treatment provided. The Arbitrator's orders establish that he found the necessary causal link.
Here, it is necessary to digress. The Arbitrator's orders were that McCain Foods (that is, EML): "… pay for the costs of the surgical treatment proposed by Dr Jane Manning in her report of 21 March 2016."
As mentioned above, Dr Manning's report of that date did not propose any surgical treatment. Dr Manning, in that report, expressed an opinion that the prolapse was caused by the lifting episode at work, and she foreshadowed a possible need for future "long term medical therapy" which she said was difficult to predict.
It was in the report of 2 September 2015 that Dr Manning proposed, explicitly, surgical treatment, which she detailed (see [22] above). That surgery included hysterectomy. And it was for that treatment that, acting on the Arbitrator's orders, EML paid. In my opinion it is clear that the date stated in the Arbitrator's order was a mistake, and that he intended to order McCain Foods (EML) to pay for the surgical treatment specified in the earlier report. It is further clear that that was how EML understood the order.
On that basis it is also clear that the Arbitrator found, in the language of s 60 of the WC Act, that not only the prolapse surgery, but also the hysterectomy, were "reasonably necessary" as a result of the plaintiff's work injury. If that were considered by EML to be incorrect, an appeal, under s 352 of the WIM Act, lay to the Commission constituted by a Presidential member. That course was not taken.
That, however, does not have the effect, as was put on behalf of the plaintiff to the Appeal Panel, that the issue of causation was closed. While the WIM Act assigns to the Commission the determination of "factual and legal issues", which include issues of causation, it assigns to the medical assessment system the determination of medical disputes - which also include issues of causation. In Bindah Emmett JA, with the concurrence of Ward JA, held that neither the AMS nor the Appeal Panel was bound by the causation decision of the Arbitrator. That decision is binding on me. And, in this Court, senior counsel drew back from putting a contrary proposition, although, perhaps, for different reasons.
It is therefore necessary to proceed on the basis that the question of causation of the plaintiff's permanent impairment (as well as its degree) was a live issue for the AMS and for the Appeal Panel. Leaving aside the effect of the Arbitrator's orders on that determination, it nevertheless remained necessary for each to grapple with the arguments advanced by the parties on the question of causation. On behalf of the plaintiff it was put to the Appeal Panel that the AMS misunderstood the task he was to perform, as indicated by his use of the word "elective", and that he misunderstood the legal concept of causation and the test to be applied in determining whether a permanent impairment "results from" a work injury.
There are difficulties in the AMS's reasons. First, it is difficult to understand the relevance of the comment that, if preservation of fertility was a priority, prolapse repair without hysterectomy was an option. Senior counsel for the plaintiff labelled the comment as "pejorative", and, indeed, it does appear to have negative undertones, casting doubt on the plaintiff's credibility in the reasons she gave for her decision to undergo the hysterectomy, and in her description of her reaction to the infertility. Moreover, to the extent that the comment has any relevance, it would tend to support at least a belief on the part of the plaintiff that the hysterectomy was made necessary by the prolapse, and hence was caused by - resulted from - the work injury. What is clear is that the AMS used the observation to the detriment of the plaintiff. And the Appeal Panel recorded the AMS's observation, without comment and with apparent endorsement, in the section of its reasons that appears under the heading "Finding and Reasons".
Second, the AMS speculated, by reference to notes of the plaintiff's general practitioner, that the plaintiff was having heavy menstrual periods with clots and that this problem and her age group may have been factors in the ultimate decision to undergo vaginal repair plus hysterectomy. EML has not identified any evidence that this was a factor in the plaintiff's decision to accept Dr Manning's advice, nor that the suggestion was raised with the plaintiff.
Finally, the AMS recorded that he could not accept the loss of fertility as "a problem for assessment". He nevertheless assigned to "the urinary and reproductive systems" a "whole person impairment" of 1%. If the hysterectomy were not causally connected to the work injury, it is difficult to explain why it relevantly resulted in any degree of permanent impairment.
It may be accepted that the evidence linking the hysterectomy with the work injury was relatively slight. It was that Dr Manning had advised the plaintiff (i) that performing the hysterectomy would achieve a "better operative result" for the prolapse surgery; and that (ii) the hysterectomy would be likely to reduce the risk of recurrence of the prolapse.
The grounds for appeal stated in s 327(3) invoked by the plaintiff were that the assessment by the AMS was made on the basis of incorrect criteria (s 327(3)(c)) and that the medical assessment certificate contains a demonstrable error (s 327(3)(d)). In Siddik v Workcover Authority of NSW [2008] NSWCA 116; (2008) 6 DDCR 228 McColl JA, with the agreement of Mason P and the substantial agreement of Giles JA, considered at some length the nature of an appeal under s 327, having regard to s 328(2) which provides that the appeal is to be by way of review of the original assessment, but limited to the grounds of appeal on which the appeal is made. McColl JA held that the appeal was not limited to the grounds stated in s 327(3), nor even (subject to affording procedural fairness) to the grounds advanced on the appeal. That proposition was further refined by Davies J in New South Wales Police Force v Registrar of the Workers Compensation Commission of New South Wales [2013] NSWSC 1792. Davies J distinguished between the terms "grounds for appeal" used in s 327(3) (identifying the limited basis on which a party may seek to satisfy the Registrar that a proposed appeal be allowed to proceed) and "grounds of appeal" used in s 328(2) (limiting the boundaries of the review by the Appeal Panel). In effect, as I understand his Honour's judgment, the Appeal Panel is entitled to have regard to the manner in which an appeal (the Registrar having allowed the appeal to proceed) is argued or presented.
With respect to the author of the submissions put to the Appeal Panel in writing, there was a degree of confusion. The submissions largely focused on the orders made by the Arbitrator, restating the proposition that those orders represented a binding conclusion as to the cause of the plaintiff's permanent impairment. For reasons already given, that proposition is contrary to current authority.
Interspersed in those propositions, however, was a contention that the AMS had "misunderstood his task", and "misunderstood the legal concept of causation". The submissions included the proposition that the plaintiff would not have had the hysterectomy "but for" the work injury.
To establish the necessary causal link, it was not sufficient, as was submitted to the Appeal Panel, that the plaintiff would not have undergone a hysterectomy but for the work injury, nor that she would not have had the hysterectomy had she not suffered the work injury and vaginal prolapse. But it may well have been sufficient if the plaintiff established, to the satisfaction of the AMS or the Appeal Panel, that undergoing the hysterectomy was likely to have improved the outcome of the vaginal prolapse surgery and reduced the risk of recurrence. Neither the AMS nor the Appeal Panel directed any attention to these considerations.

Causation

It is well established that causation is a question of fact: March v E & MH Stramare Pty Ltd (1991) 171 CLR 506; [1991] HCA 12; Kooragang Cement Pty Ltd v Bates (1994) 35 NSWLR 452 at 463.
It would be simplistic and wrong, however, to say, on the formula of Haroun, Bindah and other cases, that question of the cause of a medical condition fall outside the ambit of the medical assessment procedure provided by Ch 7, Pt 7 of the WIM Act. A number of decisions of the Court of Appeal have held to that effect: see, for example, in addition to those already mentioned, Zanardo & Rodriguez Sales & Services Pty Ltd v Tolevski [2013] NSWCA 449; (2013) 12 DDCR 515. That leaves open the unattractive but real possibility of inconsistent decisions. That, indeed, is what has happened here. The Arbitrator's decision that McCain Foods (EML) pay the costs of the hysterectomy necessarily incorporated a finding that, as a result of the work injury, that surgery, including hysterectomy, was reasonably necessary. The determinations of the AMS and the Appeal Panel, on the other hand, were that the causal connection was lacking.
In support of the application, senior counsel for the plaintiff directed attention to a series of decisions dating back to 1909 (in the United Kingdom). The decisions were Shirt v Calico Printers' Association Ltd [1909] 2 KB 51; Lindeman Ltd v Colvin (1946) 74 CLR 313; [1946] HCA 35; Garner v Burns Philp & Co Ltd (1949) 49 SR (NSW) 270; Migge v Wormald Bros Industries Ltd [1972] 2 NSWLR 29 (per Mason JA), upheld in the High Court in Migge v Wormald Bros Industries Ltd (1973) 47 ALJR 236; Kooragang and Bindah.
The general proposition for which these cases were cited is that the test of whether a particular condition or treatment results from an injury is a question of fact to be determined on the basis of reasonableness. None of the cases cited provides a precise parallel to the present case. But they do indicate that careful attention must be given to a causal link between work injury and subsequent medical condition or treatment, and that rigid lines should not be drawn to exclude a causal connection.
In the circumstances of this case, the "but for" test is inapt. It potentially oversimplifies the issue and could produce a wrong outcome. Let the following facts be supposed (the first and second of which are uncontroversial):

the lifting incident at work caused the plaintiff's prolapse;
by reason of the prolapse, repair surgery was necessary;
the plaintiff's medical specialist advised that, since abdominal surgery was to be undertaken, the plaintiff ought consider taking the opportunity of surgery in that part of the body to undergo, also, hysterectomy;
hysterectomy was not otherwise indicated and was not connected with the prolapse surgery;
the plaintiff accepted the advice and had the hysterectomy in tandem with the necessary vaginal repair.

In those circumstances, it could properly be said that "but for" the prolapse surgery, the plaintiff would not have undergone hysterectomy. It would be difficult, however, causally to relate the hysterectomy to the prolapse surgery, and, more particularly, to the work injury. Rather, the conclusion would be that the hysterectomy was coincidental with the prolapse surgery, and otherwise unrelated to the work injury. It must be borne in mind that the necessary causal connection is between the work injury and the hysterectomy. Some of the submissions made on behalf of the plaintiff to the Appeal Panel may be taken as arguing for a causal connection of the kind I consider to be unsustainable on the factual scenario I have outlined. In those circumstances rejection of the plaintiff's case on causation would be correct.
But that was not the whole of the plaintiff's case. True it is that, on the evidence, it was unlikely that the plaintiff would have undergone hysterectomy at the time she did had it not been for the need for the prolapse surgery. But her case was more complex than that. On her evidence, her decision to undergo hysterectomy was more than coincidental with the need for prolapse surgery; it gained its necessary causal connection from the advice given by Dr Manning of the potential benefits to the outcome of the prolapse surgery of including the hysterectomy. It was this that neither the AMS nor the Appeal Panel addressed.
The plaintiff's case at all times was that the decision to undergo the hysterectomy resulted from her now undoubted need to undergo the vaginal repair surgery. Dr Manning's reports and advice constituted evidence of the causal connection, to which neither the AMS nor the Appeal Panel paid adequate attention. Rather, they categorised the surgery as "elective" (which they appeared to regard as decisive), and considered other hypothetical reasons for the plaintiff's decision, reasons which had no basis in the evidence.
Nowhere in the "Findings and Reasons" is there any discussion of the plaintiff's contention that the hysterectomy and consequent permanent impairment "resulted from" the work injury. The statement at [53] that the Appeal Panel was unable to accept that the need for the hysterectomy only occurred because of the compensable injury is nothing but a conclusion, lacking any reasoned explanation. The Appeal Panel was obliged, in the execution of its task, to grapple with the plaintiff's contentions and, if it rejected them, to explain why. The Appeal Panel made no reference, for example, to the statements attributed to Dr Manning that performing the hysterectomy would give a "better operative result" for the prolapse surgery, and that it would reduce the risk of recurrence of prolapse. Although mentioned in passing, these were significant considerations on the question of causation, warranting due attention. They were not given that due attention.
Nor did the Appeal Panel give any explanation for agreeing (at [57]) with the conclusion of the AMS that the hysterectomy was an elective procedure; nor, for concurring, at [58], with the AMS's finding (based on his medical knowledge and judgment) that the hysterectomy was not the result of the work injury.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 15 October 2019

which I will refer in these reasons as "work injury"). The Workplace Injury Management and Workers Compensation Act 1998(NSW)

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