Comcare v ZZRP

Federal Court of Australia|2019-06-21|Before: Flick J

The appeal from the decision of the Administrative Appeals Tribunal is allowed.
The matter is remitted to the Administrative Appeals Tribunal for reconsideration in accordance with law. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT FLICK J: 1 The Respondent to the present proceeding, identified by the pseudonym ZZRP, commenced employment with the Australian Taxation Office in 1999. He ceased his employment in 2012 when he was retired on grounds of invalidity. 2 In May 2011, he lodged a claim for compensation under the Safety, Rehabilitation and Compensation Act 1988 (Cth) (the "Safety Compensation Act"). After having been off work from March 2011 due to a back injury, the Respondent returned to work in April 2011. In his absence a new manager had assumed supervisory responsibility. The Respondent claimed (inter alia) that he was "repeatedly harassed". His claim was accepted for "Depressive Disorder" and "Anxiety State" and was accepted as a "disease" for the purposes of the Act. 3 In May 2014, however, Comcare determined that ZZRP was no longer entitled to compensation. The Respondent requested an internal review. In July 2014, the earlier decision made in May was affirmed. Comcare formed the view that ZZRP's condition was no longer attributable to his former employment with the Australian Taxation Office. The Respondent then sought review of Comcare's decision by the Administrative Appeals Tribunal (the "Tribunal"). In July 2018, the Tribunal set aside the decision under review and remitted the matter to Comcare for the quantification of monetary entitlements: Re ZZRP and Comcare (Compensation) [2018] AATA 2240. 4 Comcare now appeals to this Court. In very summary form, Comcare contends in its Notice of Appeal from a Tribunal that the Tribunal failed to: apply the correct statutory test when deciding that the Respondent was entitled to compensation; resolve its submission that the Respondent's psychological ailment was no longer "contributed to, to a significant degree, by [his] employment with the Commonwealth"; and provide adequate reasons for aspects of its reasons. 5 Comcare and ZZRP were both represented by Counsel before this Court. 6 The appeal is to be allowed. The inadequacy in the reasoning of the Tribunal is, of itself, a sufficient basis upon which to allow the appeal.

The legislative provisions 7 It was common ground between Comcare and ZZRP that an entitlement to compensation is to be resolved by the application of ss 16 and 20 of the Safety Compensation Act. 8 Section 16(1) provides as follows: Where an employee suffers an injury, Comcare is liable to pay, in respect of the cost of medical treatment obtained in relation to the injury (being treatment that it was reasonable for the employee to obtain in the circumstances), compensation of such amount as Comcare determines is appropriate to that medical treatment. Section 20(1) provides as follows: Compensation payable to an employee who is incapacitated for work as a result of an injury is determined in accordance with this section if: (a) the employee is retired from his or her employment (whether the employee retired voluntarily or was compulsorily retired); and (b) the employee receives a pension under a superannuation scheme as a result of the employee's retirement. 9 The term "injury" is defined in s 5A(1) as follows: (1) In this Act: injury means: (a) a disease suffered by an employee; or (b) an injury (other than a disease) suffered by an employee, that is a physical or mental injury arising out of, or in the course of, the employee's employment; or (c) an aggravation of a physical or mental injury (other than a disease) suffered by an employee (whether or not that injury arose out of, or in the course of, the employee's employment), that is an aggravation that arose out of, or in the course of, that employment; but does not include a disease, injury or aggravation suffered as a result of reasonable administrative action taken in a reasonable manner in respect of the employee's employment. The term "disease" is defined in s 5B as follows: (1) In this Act: disease means: (a) an ailment suffered by an employee; or (b) an aggravation of such an ailment; that was contributed to, to a significant degree, by the employee's employment by the Commonwealth or a licensee. (2) In determining whether an ailment or aggravation was contributed to, to a significant degree, by an employee's employment by the Commonwealth or a licensee, the following matters may be taken into account: (a) the duration of the employment; (b) the nature of, and particular tasks involved in, the employment; (c) any predisposition of the employee to the ailment or aggravation; (d) any activities of the employee not related to the employment; (e) any other matters affecting the employee's health. This subsection does not limit the matters that may be taken into account. (3) In this Act: significant degree means a degree that is substantially more than material. An "injury" and a "disease' are not mutually exclusive categories: Prain v Comcare [2017] FCAFC 143 at [72], (2017) 256 FCR 65 at 84 per Kenny, Tracey and Bromberg JJ. 10 The two concepts of "caused" and "significant degree" warrant further brief exposition. 11 As to the former term, in Comcare v Martin [2016] HCA 43, (2016) 258 CLR 467 at 479 French CJ, Bell, Gageler, Keane and Nettle JJ observed: [42] Causation in a legal context is always purposive. The application of a causal term in a statutory provision is always to be determined by reference to the statutory text construed and applied in its statutory context in a manner which best effects its statutory purpose. It has been said more than once in this Court that it is doubtful whether there is any "common sense" approach to causation which can provide a useful, still less universal, legal norm. Nevertheless, the majority in the Full Court construed the phrase "as a result of" in s 5A(1) as importing a "common sense" notion of causation. That construction, with respect, did not adequately interrogate the statutory text, context and purpose. [43] Within a statutory context which includes ss 5A and 5B, the exclusionary phrase "as a result of" in s 5A(1) is naturally read, not as imposing its own separate and free-standing test of causation, but rather as referring relevantly to the test of causation spelt out in s 5B(1). [44] The application of the definition of disease in s 5B(1) means that, to have suffered a disease falling within s 5A(1)(a), the employee must have suffered an ailment or aggravation of an ailment that was contributed to, to a significant degree, by the employee's employment… (footnotes omitted) 12 As to the latter concept, s 5B had been inserted into the Safety Compensation Act by the Safety, Rehabilitation and Compensation and Other Legislation Amendment Act 2007 (Cth). In Comcare v Power [2015] FCA 1502, (2015) 238 FCR 187 at 204 Katzmann J traced the prior legislative history which led to the introduction of the "significant degree" test and, in doing so, her Honour observed (in part) as follows: [93] There is no room for doubt that the purpose of the 2007 amendments was to strengthen the connection necessary between the employment and the contraction or aggravation of a disease. Including a definition of "significant" as "substantially more than material" makes this abundantly clear. In other words, it is insufficient that the contribution of the employment be "more than trivial"; it had to be substantially more than trivial. [94] Moreover, the current test of contribution also requires an evaluative exercise to be undertaken. That is apparent both from the words used in subs (1) of s 5B and also the matters to which subs (2) draws attention. The Tribunal did not engage with any of them. Indeed, it did not mention subs (2) at all … 13 Prior to the 2007 amendments, s 4 had defined a "disease" as meaning any ailment or aggravation of any ailment suffered by an employee "that was contributed to in a material degree by the employee's employment by the Commonwealth". When addressing that definition, in Comcare v Sahu-Khan [2007] FCA 15, (2007) 156 FCR 536 at 542 to 543 ("Sahu-Khan"), Finn J had observed (in part): [15] There are, in my view, obvious hazards in allowing finely nuanced differences in dictionary definitions to contrive the answer to this question, given as I have noted, that the word "material" in this context had its legislative meaning set in part by the qualification it imposed on the nature of the contribution required to be demonstrated before the provisions of the SRC Act were engaged. This said I consider that one of the meanings of the word "materially" in the Shorter Oxford English Dictionary probably captures the essence of what the legislature was conveying. That meaning is: "4. In a material degree; substantially, considerably." An example given of this usage is that of contributing "materially to the funds required" for a purpose. … [16] Bearing in mind that the course of statutory construction is often not aided by substituting for the word used in an enactment, another word which is not so used, probably the best that can ultimately be said is that the s 4 definition: (i) requires a stronger causal relationship between the employment and the ailment, etc suffered than that exacted by the 1971 Act; (ii) "in a material degree" requires an evaluation of all relevant contributing factors for the purpose of asking whether the employee's employment did or did not contribute materially to the suffering of the ailment, etc, in question ("the threshold evaluation"); (iii) whether this will be so in a given case will be a matter of fact and degree. 14 The 2007 amendment, by requiring that a disease be one that was contributed "to a significant degree" by the relevant employment - being "a degree that is substantially more than material" - thus "strengthen[ed] the connection necessary between the employment and the contraction or aggravation of a disease" than that required by the definition previously considered by Finn J in Sahu-Khan: Comcare v Power [2015] FCA 1502 at [93], (2015) 238 FCR at 204. The test inserted in 2007 was that of "significant degree" rather than "material degree". This was unquestionably one of the "important changes to the definition": Kowalski v Military Rehabilitation and Compensation Commission [2010] FCAFC 10 at [54] per Marshall, Tracey and Foster JJ. This "tightening of the causation standard" followed the report of the Productivity Commission into workers compensation titled National Workers Compensation and Occupational Health and Safety Frameworks, Report No 27, 16 March 2004: Zdziarski v Telstra Corporation Limited [2015] FCA 207 at [15] per Perram J. 15 After 2007, it was this "tightened" requirement which ZZRP had to satisfy and it was this requirement which the Tribunal had to apply to the facts presented.

The Tribunal's jurisdiction 16 In considering ZZRP's application, the jurisdiction being exercised by the Tribunal was that conferred by s 64 of the Safety Compensation Act. 17 When undertaking its review function, the Tribunal was relevantly required to: undertake a review of the merits of the administrative decision under review and to determine what it considered to be the "correct or preferable decision": cf. Drake v Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409 at 419 per Bowen CJ and Deane J; and, where it provided written reasons for its decision, the Tribunal was required to: include in those reasons "its findings on material questions of fact and a reference to the evidence or other material on which those findings were based": Administrative Appeals Tribunal Act 1975 (Cth), s 43(2B) (the "Administrative Appeals Tribunal Act"). "Sufficient reasons" must be provided "to make the system of appeals effective": Roncevich v Repatriation Commission [2005] HCA 40 at [62], (2005) 222 CLR 115 at 135 per Kirby J. See also: Summers v Repatriation Commission [2015] FCAFC 36 at [110], (2015) 230 FCR 179 at 209 per Kenny, Murphy and Beach JJ. It must be possible "to discern from the reasons given the actual reasoning process adopted": cf. Comcare v Mathieson [2004] FCA 212 at [61], (2004) 79 ALD 518 at 531 per Weinberg J. "[T]he Tribunal will have discharged its duty under s 43 if its reasons disclose its findings of fact, the evidence on which they were based and the logical process by which it moved from those findings to the result in the case": Secretary, Department of Employment and Workplace Relations v Homewood [2006] FCA 779 at [40], (2006) 43 AAR 236 at 245 per French J. 18 The jurisdiction of this Court is that conferred by s 44(1) of the Administrative Appeals Tribunal Act and is confined to the hearing of an appeal from a decision of the Tribunal "on a question of law". "That is an important jurisdictional limitation": Australian Postal Corporation v Nunez [2014] FCA 1095 at [1], (2014) 227 FCR 249 at 250 per Griffiths J. An alleged failure to give reasons in accordance with either s 43(2) or (2B) of the Administrative Appeals Tribunal Act involves a question of law: Comcare v Singh [2012] FCA 136 at [22], (2012) 126 ALD 119 at 124 per Jagot J. Similarly, in Dornan v Riordan (1990) 24 FCR 564 at 573 Sweeney, Davies and Burchett JJ had observed that a "substantial failure to state reasons for a decision, in the circumstances that a statement of reasons is a requirement of the exercise under the statute of the decision-making power, constitutes an error of law". See also: Bis Industries Ltd v Dale [2017] FCA 789 at [82] to [85], (2017) 72 AAR 312 at 327 to 328 per Rangiah J. If an appeal is allowed, s 44(6) of the Administrative Appeals Tribunal Act expressly contemplates that the Tribunal may be differently constituted. The manner in which the power to make an order that the Tribunal be differently constituted "is to be resolved by reference to the facts and circumstances of each individual appeal. The power … should not be more confined than that. The exercise of the power should not be approached with any inclination that it should 'usually' be exercised in one manner rather than another ...": Comcare v Broadhurst [2011] FCAFC 39 at [94], (2011) 192 FCR 497 at 516 to 517 per Tracey and Flick JJ.

The Tribunal's findings and reasons 19 In very summary form, the case sought to be advanced before the Tribunal by Comcare was that any "disease" suffered by ZZRP as at 2014 was not a "compensable disease" under the Safety Compensation Act. Comcare submitted that in the event that the Tribunal was satisfied that ZZRP continued to suffer from a psychological ailment, it no longer constituted a "disease" because that ailment was no longer contributed to - to a significant degree - by ZZRP's former employment with the ATO. It was submitted to the Tribunal that "factors unrelated to [ZZRP's] former employment at the ATO are more likely than not to have had the effect of pushing any employment related factors further and further into the background to a point where the Tribunal may properly regard the employment-related factors as having ceased to be a significant contributor to any ailment(s) that are currently suffered [by ZZRP]". In support of its case, it relied upon three reports from psychiatrists: Dr Richard Burek, Dr Alison Moffatt, and Dr Frank Chow. 20 At the outset of the published reasons, the Tribunal identified for itself the task to be undertaken when undertaking its review functions as follows: [2] … I must consider whether that decision was the correct or preferable decision, and if not, whether the applicant has entitlements under sections 16 and 20 of the Safety, Rehabilitation and Compensation Act 1988 (Cth), in respect of the intervening period. I am not concerned with the quantification of any such entitlement. After setting forth the prior decision-making chain which led to the application for review, the Tribunal's reasons thereafter addressed what it referred to as: the "Chronology of the Applicant's Condition" (at paras [6] to [19], that chronology setting forth the prior medical reports with respect to the now-Respondent and the personal circumstances confronting the now-Respondent); the "Evidence before the Tribunal" (at paras [20] to [47], that section setting forth the evidence referring to (for example) the medical reports of medical practitioners which were tendered); the "Consideration of the evidence" (at paras [48] to [52]); and the "Decision" to set aside the decision under review (at para [53]). 21 The Consideration of the evidence warrants being set forth in full. Those paragraphs state as follows: CONSIDERATION OF THE EVIDENCE [48] The history reveals a rather consistent pattern of diagnosis by treating general practitioners of depression and anxiety, from May 2011 until the present time. As to the reliance by Comcare in 2014 upon Dr Burek's report to the contrary, and his nomination of alcohol induced cognitive deterioration and paranoia, that report is largely unsupported in the reports of other specialists and is unsupported by the statutory declaration of the applicant's father. I am inclined to reject that report. [49] I was impressed by Dr Howard's evidence, which is also consistent with that of a number of other persons who treated the applicant. Dr Howard attributed the depression and anxiety mainly to the events in the workplace of 2011, and I conclude that those events caused the depression and anxiety, and still do so. The evidence of Mr Penman suggests that no such condition was evident prior to April 2011, and the diagnosis of depression and anxiety was confirmed in 2011 by Dr Allnutt. More recent evidence to the same effect appears from the results of psychometric tests administered by Mr Henrick, and Dr Moffatt observed mild depression and a degree of self-reported anxiety. [50] As to the possibility of paranoia, or paranoid ideation, the causes of the hospitalisations of 2011 and 2013 seem to have been preceded by psychotic episodes, albeit that on each occasion, relatively short term medication seems to have been successful in alleviating the condition on each occasion, and it seem not to have returned. Whether the psychotic episodes of late 2011 and of 2013 were themselves episodes for which the applicant was to some extent predisposed by his anxiety and depression, does not appear from the evidence before me. [51] I am not satisfied to find that the applicant has or had any bipolar condition on the evidence before me, despite some isolated references in the evidence to that diagnosis. [52] As I have said, I am not satisfied that alcohol use accounts for his current condition or for the stresses he experienced in the workplace, and the evidence of daily cannabis use self-reported on the telephone in 2010 to the Queenscliff Community Health Centre may possibly have been falsely reported, as he rather suggested. The applicant has not self-reported any such use since that time, although it was a matter about which he was regularly asked. Some instances of cannabis use appear from hospital notes at the Manly Hospital, but his current condition is not attributed to that circumstance by his current treating doctor and is not reported by others who have been in regular contact with him. It does not appear from the evidence to my satisfaction that any such cannabis use affects his current or any former condition. 22 These reasons, with great respect to the Tribunal member, fail to comply with s 43(2B) of the Administrative Appeals Tribunal Act. 23 It is to be recalled that Ground 3 of the Notice of Appeal from a Tribunal contends that the Tribunal failed to provide adequate reasons for its decision and thus failed to comply with s 43(2B) of the Administrative Appeals Tribunal Act. Specifically, Comcare contends that the Tribunal failed to provide adequate reasons with respect to three aspects of its reasoning, namely it failed to: deal with whether the Respondent's psychological ailment, if any, was no longer "contributed to, to a significant degree" by his employment by the ATO; deal with whether the Respondent's psychological ailment, if any, was "crowded out by non-work related factors such that the Respondent's employment by the ATO no longer contributed, to a significant degree" to his ailment; and disclose adequate reasons regarding what can be broadly be characterised as the competing medical evidence of Dr Chow and Dr Howard. 24 Although a challenge was made on behalf of Comcare to the adequacy of the Tribunal's reasoning process with respect to the manner in which it resolved the competing medical opinions of Dr Chow and Dr Howard, it may be noted that the Tribunal: gave some reasons for its reliance upon the evidence of Dr Howard (at para [49]). But such explanation as was provided, with respect: failed to make findings or to adequately explain how the opinion of Dr Chow fed into the ultimate decision-making process being undertaken by the Tribunal or why Dr Chow's evidence was considered but placed to one side. The only explanations that may be gleaned from the reasons of the Tribunal as to why his evidence may not have been given greater weight is that found in the Tribunal's statement that Dr Chow was "cross-examined by the applicant who elicited from him that his report was intended to do more than indicate how he presented on 2 December 2016 in the course of one consultation" (at para [44]) and the observation that "Dr Chow may have experienced [ZZRP] on one of his better days" (at para 45]). But there was no further explanation provided. Even with respect to the reliance placed upon the opinion of Dr Howard: the Tribunal failed to expressly identify the "number of other persons who treated the applicant" referred to in para [49] unless those persons are to be inferred to be the other medical professionals set out in that paragraph, which remains unclear. Although an administrative decision-maker need not give reasons with respect to how each piece of competing evidence is to be resolved (cf. SZEHN v Minister for Immigration & Multicultural & Indigenous Affairs [2005] FCA 1389 at [58] per Lindgren J; SZHPI v Minister for Immigration and Citizenship [2008] FCA 306 at [15] per Branson J; Kang v Secretary, Department of Social Services [2017] FCA 895 at [72] per McKerracher J), it may be expected that there will be some explanation provided where the competing evidence goes to the very basis upon which a decision is ultimately reached. Greater exposition of the manner in which the competing opinions of Dr Chow and Dr Howard were resolved would, undoubtedly, have been desirable. If the fact that Dr Chow's evidence was not considered persuasive by reason of the fact that his assessment was based on the one consultation in December 2016, it would have been desirable to have so found. 25 Had Comcare relied solely upon an asserted deficiency in the manner in which the Tribunal resolved the competing views of Drs Chow and Howard, it may nevertheless be doubted that this alone would have led to the present appeal being allowed. 26 Reservation may also be expressed as to the manner in which the Tribunal resolved Comcare's submissions as to whether any current ailment of ZZRP could be attributed to causes other than his prior employment with the ATO. But paras [50] to [52] probably set forth adequate reasons. 27 It is, however, Comcare's challenge to the adequacy of the reasoning of the Tribunal with respect to the manner in which it applied the statutory test to the facts as found which is well-founded. The deficiency in that reasoning process is exposed by: other than the reference to ss 16 and 20 of the Safety Compensation Act at the outset of the Tribunal's reasons for decision (at para [2]), there is no exposition of the terms of those statutory provisions regulating entitlement of compensation and no attempt to apply the statutory provisions to such facts as were the subject of findings of fact. Indeed, there is no reference in the reasons to the definition of a "disease" in s 5B; the absence in the reasons of any exposition in accordance with established principles, and an absence of any findings, as to whether ZZRP's "disease" could as at 2014 be said to have been "contributed to" by his former employment and (if so) whether it was contributed to a "significant degree"; and there is no reference to - and no attempt to deal with - the submission advanced on behalf of Comcare or (at the very least) no adequate reasons provided for why its submissions in respect to contribution to a "significant degree" were resolved. The reliance sought to be placed by ZZRP upon the reference (at para [49]) to the evidence of Dr Howard that "the depression and anxiety" may be "attributed … mainly to the events in the workplace of 2011" and the conclusion "that those events caused the depression and anxiety, and still do", with respect, is misplaced because: that conclusion leaves open any consideration as to whether the Tribunal was attempting to make a finding (albeit without expressly saying so) that it was equating a comparison of "mainly" with that test prescribed by the Safety Compensation Act. Although "finely nuanced differences in dictionary definitions" should not intrude into an analysis of an evaluation as to whether a disease has been contributed to by employment to a "significant degree … that is substantially more than material" (cf. Sahu-Khan) any more than a "finely nuanced" approach should be pursued on appeal as to whether the term "mainly" falls within the statutory language of "significant degree", the difficulty with the reasoning of the Tribunal in the present case remains. 28 In reaching this conclusion, it is the absence of any express reference to the established principles in respect to contribution and whether a disease has been contributed to a "significant degree" by employment at the ATO which occasions concern. Specifically, it raises concern at the outset as to whether the Tribunal was setting itself on the right path in identifying for itself the correct test to be applied and thereafter setting itself on the right path in applying the facts to that statutory test. The absence of any more detailed evaluation of the competing medical opinions of Drs Chow and Howard only compounds this concern. 29 The reasons provided by the Tribunal fail to put this Court in the position where it can identify with any reasonable certainty whether there is appellable error, other than the very failure to provide reasons. Left is the disturbing impression that the Tribunal has summarised the evidence before it and merely expressed an unreasoned conclusion that it prefers the evidence of Dr Howard. An informed reader of the Tribunal's decision, and this Court, is left with no assistance as to why? Left unanswered is the underlying concern as to whether the Tribunal set itself from the outset upon answering the questions posed by ss 16 and 20 of the Safety Compensation Act.

A differently constituted Tribunal 30 In seeking an order that the matter be remitted to the Tribunal differently constituted, Comcare relied on the Tribunal's failure to: make findings of fact including with respect to how the Tribunal evaluated the competing evidence of Dr Chow and Dr Howard and the absence of reasons for ultimately preferring the evidence of Dr Howard; and make findings as to the test to be applied in determining entitlement to compensation. Reliance was also placed upon: the manner in which the Tribunal dealt with the evidence of ZZRP (at para [45]), the evaluation of his evidence - it being contended - indicating an assessment as to the reliability of his evidence being an assessment which is best undertaken afresh by a different Tribunal member. Although not expressed in terms of a reasonable apprehension of bias, Comcare maintained that a reasonably informed lay observer would have misgivings if the same Tribunal member were required to reconsider the application for review. 31 If it be concluded that the Tribunal failed to apply the correct test or failed to resolve a submission advanced, Comcare further maintained that: no additional costs would be incurred if the matter was to be resolved by a different Tribunal member. 32 Although reservation has been expressed as to the manner in which the Tribunal has resolved (or failed to adequately resolve) the departure in the evidence of Dr Chow from that of Dr Howard, and failed to adequately deal with submissions advanced by Comcare, it is ultimately considered that the constitution of the Tribunal upon the matter being remitted to it should be left to be resolved by the Tribunal President. Expressly not made is any order that the Tribunal should be differently constituted.

CONCLUSIONS 33 Whether or not the Tribunal complies with the requirement to provide reasons as prescribed by s 43(2B) of the Administrative Appeals Tribunal Act gives rise to a "question of law" for the purposes of s 44(1) of that Act: cf. Comcare v Singh [2012] FCA 136 at [22]. 34 It has been concluded that the Tribunal has failed to provide reasons which comply with s 43(2B). 35 It follows that on the facts of the present case that the appeal from the Tribunal's decision must be allowed. 36 The application made on behalf of Comcare that the matter should be remitted to the Tribunal differently constituted, however, is rejected. It should be left to the President of the Tribunal to determine how the Tribunal should be constituted when the matter again comes before it. 37 Comcare did not seek any order as to costs other than that each party should pay its own costs. Accordingly, there is no order as to costs.

THE ORDERS OF THE COURT ARE:

The appeal from the decision of the Administrative Appeals Tribunal is allowed.
The matter is remitted to the Administrative Appeals Tribunal for reconsideration in accordance with law. I certify that the preceding thirty-seven (37) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Flick.

Safety, Rehabilitation and Compensation and Other Legislation Amendment Act 2007(Cth)

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