Crean v Burrangong Pet Food Pty Limited

Campbelltown City Council v Vegan [2004] NSWSC 1129 Campbelltown City Council v Vegan [2006] 235 ALR 342; NSWCA 284 Commissioner for the Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576 Crisp v Chapman (1994) NSWCCR 492 Kioa v West (1985) 159 CLR 550 CASES CITED : Lukacic v Vickarini Pty Ltd & Anor [2007] NSWSC 530 Re Minister for Immigration and Multicultural and IndigenousAffairs: ex parte Palme (2003) 216 CLR 212 Skillen v MKT Removals Pty Ltd [2007] NSWSC 608 Smith v Liquip Services Pty Ltd & Ors [2007] NSWSC 687 SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 81 ALJR 515 Thompson v WorkCover Queensland [2002] QSC 119

Paul Anthony Crean (Pltf) PARTIES : Burrangong Pet Foods (1D) Registrar of the Workers Compensation Commission (2D) Medical Appeal Panel Workers Compensation Commission (3D)

P R Stockley (Pltf) COUNSEL : M Allars (1D) Submitting appearance (2D) Submitting appearance (3D)

SOLICITORS : McCabe Partners Lawyers (Pltf) Moray & Agnew (1D)

LOWER COURT JUDICIAL OFFICER : Medical Appeal Panel

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

30024/07 CREAN v BURRANGONG PET FOOD PTY LIMITED & ORS

JUDGMENT 1 HIS HONOUR: The plaintiff filed an Application to Resolve a Dispute with the Workers' Compensation Commission seeking compensation for injuries he sustained while employed by the first defendant. He was employed at the Young Abattoir where he was required to handle large pig carcasses. He suffered injuries to his leg and back. He ceased work in late 2003. 2 The plaintiff claimed permanent losses and impairments under the Table of Maims pursuant to s 66 of the Workers' Compensation Act 1987 as a result of injuries sustained prior to 31 December 2001. He also claimed Whole Person Impairment as a result of injuries sustained after 31 December 2001. The most significant injuries which he alleged were those to his back with consequential effects on his leg and sexual functions. 3 The first defendant denied that the plaintiff had suffered any permanent loss within the meaning of s 66 of the Workers' Compensation Act 1987. This created the dispute within the meaning of s 319 Workplace Injury Management and Workers' Compensation Act 1998. 4 On 7 December 2004 Arbitrator Ross Bell requested a medical assessment of the plaintiff by two Approved Medical Specialists being an orthopaedic surgeon and a urologist. As a consequence the plaintiff was examined by Dr Lahz who performed an orthopaedic examination and issued a Medical Assessment Certificate on 18 May 2006. He was also examined by Dr Taylor, a urologist who provided both an original and an amended Assessment Certificate. 5 Dr Lahz, certified the plaintiff for injuries received prior to 1 January 2002, as having total permanent loss of efficient use of the right leg at or above the knee at 5% and the back at 10%. On the same date Dr Lahz issued a second Medical Assessment Certificate assessing the plaintiff in accordance with AMA 5 and the work cover guidelines for injuries received after 1 January 2002 as having a whole person impairment in respect of the lumbar spine of 7% and in respect of the right lower extremity as 0%. These percentages were arrived at with a deduction for pre-existing injury of 1% in respect of the lumbar spine and 0% in respect of the right lower extremity. 6 The two assessments were necessary because of the commencement of the Workplace Injury Management and Workers' Compensation Act 1998 on 1 January 2002 which provided a different regime for the assessment of injuries and compensation. 7 Dr Stewart Taylor issued a Medical Assessment Certificate in which he assessed the plaintiff's claim in relation to loss of sexual organs in accordance with the table of disabilities for injuries received before 1 January 2002 as 0%. In the same certificate Dr Taylor assessed the plaintiff in accordance with AMA 5 and the impairment guidelines as having a percentage of whole body impairment in respect of sexual organs of 0%. However, in his report Dr Taylor had indicated that in his opinion the plaintiff had a percentage of permanent loss of efficient use of his sexual organs at 60%. 8 On 26 May 2006 the plaintiff's solicitor wrote to the Workers' Compensation Commission and identified several features of the Medical Assessment Certificates that were said to be incorrect, inconsistent or incomplete. In particular the plaintiff identified the fact that Dr Taylor had qualified his opinion in relation to the plaintiff's loss in the following manner: "Interference with his sexual function commenced after the injury of 10 October 2002. However, from the time he took up the position of a slaughterman, he was doing very heavy work involving heavy lifting and strain on his back and at times frank episodes of back pain. If appropriate orthopaedic opinions are of the opinion that the nature and conditions of employment before 10.10.02 contributed to the back injury that occurred on that day, then it is my opinion that an apportionment must be made to apportion a degree of his loss of sexual organs to the nature and conditions of his employment before 10.10.02. Thus, for example, if these orthopaedic opinions are that x% of his back pain is due to injuries that occurred before 1 January 2002, then in my opinion it is reasonable to conclude that x% of a degree of loss (SIC) of his sexual organs is due to those injuries. However, this apportionment cannot be done until a decision has been made regarding the orthopaedic opinions. As it stands I have given my opinion in this M.A.C on the history that Mr Crean gave to me personally which was that his loss of use of his sexual organs only started after the injury on 10/10/2002. As pointed out above I am prepared to consider changing this opinion in light of the final orthopaedic opinion. " (emphasis added) 9 The solicitor also contended that Dr Taylor's certificate contained an error. The error was said to be found in the fact, as I have already indicated, that his report had stated that the plaintiff had a permanent loss of efficient use of his sexual organs of 60% but had been assessed as having a Whole Body Impairment of sexual organs at 0%. 10 Finally, it was submitted that because Dr Taylor had not been provided with Dr Lahz' report, in which the latter identified back injury prior to 1 January 2002, this was fresh evidence which should have been made available to Dr Taylor before he provided his certificate. 11 On 13 June 2006 the plaintiff lodged an application to appeal against the decision of the approved medical specialist. Annexed to the application were the relevant Medical Assessment Certificates and the solicitor's letter of 22 May 2006. Subsequently further submissions were made, the essence of which was that: · Dr Taylor had failed to consider the contents of Dr Lahz' certificate in respect of apportionment and accordingly had failed to give proper consideration to the question of the plaintiff's loss of sexual organs before 1 January 2002. · Dr Lahz had failed to assess losses and impairments resulting from the alleged aggravation by his employment with the first defendant of injury or disease which had originated prior to that employment. He alleged that the injury to his back was initiated "during his work history of heavy employment (rather than) his actual employment with the respondent." It was submitted that the decision of Dr Lahz was affected by "legal, factual and discretionary error." · medical reports of Dr James Bodel qualified on behalf of the employer had been erroneously forwarded to the approved medical specialists. 12 The defendant took issue with these submissions and contended, inter alia, that no appeal was available or that, if available, was confined to the certificate of Dr Taylor. 13 On 29 September 2006 the Registrar decided that the Medical Assessment Certificate of Dr Taylor of 18 May 2006 contained a demonstrable error and that the appeal should be referred to a Medical Appeal Panel. On 9 November 2006 a different delegate of the Registrar decided that an appeal could proceed in respect of the Medical Assessment Certificate of Dr Lahz. The Registrar rejected the submission in relation to Dr Bodel's reports and that matter is of no present relevance. 14 In the meantime the opinion of Dr Lahz was referred to Dr Taylor who issued a further Assessment Certificate. Although he noted that he had been referred to Dr Lahz' report the wording in his report and Certificate were identical to the original. He assessed the permanent loss of efficient use of the plaintiff's sexual organs at 0% and Whole Body Impairment for sexual organs at 0%. However, the report continued to indicate that in Dr Taylor's opinion the plaintiff had suffered a total percentage of permanent loss of his sexual organs of 60%.

The decision of the Appeal Panel 15 On 23 November 2006 the Appeal Panel revoked Dr Lahz' Medical Assessment Certificate and the second certificate issued by Dr Taylor. The Panel issued a certificate under the Table for Disabilities Injuries received before 1 January 2002. It assessed the plaintiff's total permanent percentage loss of efficient use or impairment of the back at 10%, the right leg at or above the knee at 5% and sexual organs at 0%. The Appeal Panel also issued a certificate for injuries received after 1 January 2002 assessing the plaintiff's whole person impairment in respect of the lumbar spine at 4%, the right lower extremity as no rateable impairment and sexual organs at 0%. 16 The Appeal Panel published a written decision. In relation to its function when determining the appeal it said: "The role of the Medical Appeal Panel was considered by the Supreme Court in Campbelltown City Council v Vegan [2004] NSWSC 1129. Mr Justice Wood determined that (once the Registrar has determined that an error exists) the role of the panel appointed to deal with the matter is to conduct a review de novo and that review is not limited to the errors found. The Panel is free to conduct a review upon the basis of the material before it, without the need to make a formal finding itself as to the existence of an error falling within an available ground of appeal, and without being confined to the correction of that error. The decision also confirmed that the Panel is not obliged to give full reasons. The Panel is of the view that where its decision will affect people's rights it is appropriate to give sufficient reasons for the parties to understand the reasons for the decision reached by the Panel. Section 327(2) of the 1998 Act restricts the Appeal to those matters conclusively presumed to be correct and ss(3) sets out the grounds for appeal. In this matter the Registrar has determined that at least one of the grounds of appeal exists. The Panel has accordingly conducted a review of the material before it and reached its own conclusion concerning the impairments and losses suffered by the Appellant." 17 Having provided this statement the Panel continued to consider the issues which it understood arose in the appeal. It first considered the orthopaedic issue: "In that respect, the Panel reviewed the referral to the AMS provided by the Arbitrator and dated 7 December 2004. The Referral required the Respondent to file the reports of Dr Bodel dated 12 November 2004 (x3) listed in the Reply "in 7 days". The referral indicates that the Arbitrator found that the following injuries required assessment: 'Permanent impairment of the back; loss of efficient use of the right leg at or above the knee; loss of sexual organs." As a result of the nature and conditions of employment from 15 September 1998 to 11 July 2001. Whole person impairment in respect of the lumbar spine; the right lower extremity; sexual organs" as a result of injuries sustained on 15 June, 9, 10, 11 October 2002 and the nature and conditions of employment from 28 April 2002 to 1 April 2003.' The Panel is mindful that the Arbitrator found that the Appellant had suffered injuries which required assessment of both the percentage permanent loss of efficient use of a body part and a WPI assessment. Accordingly the AMS was required to consider the injuries and provide assessment for both time periods. Dr Lahz's MAC clearly indicates that she undertook the assessments as referred. However having found that the Appellant suffered a 10% permanent impairment of the back attributable to the nature and conditions of his employment pre 1 January 2002 the AMS then applied a 1/10th deduction to her post 1 January 2002 assessment of 8% WPI of the lumbar spine. In the Panel's view given the AMS's significant finding of pre-existing impairment a 'nominal' deduction pursuant to section 323 of the 1998 Act cannot be sustained. In this regard the Panel refers to section 323 of the 1998 Act which provides: 'Deduction for previous injury or pre-existing condition or abnormality (1) In assessing the degree of permanent impairment resulting from an injury, there is to be a deduction for any proportion of the impairment that is due to any previous injury (whether or not it is an injury for which compensation has been paid or is payable under Division 4 of Part 3 of the 1987 Act) or that is due to any pre-existing condition or abnormality. (2) If the extent of a deduction under this section (or part of it) will be difficult or costly to determine (because, for example, of the absence of medical evidence) [emphasis added], it is to be assumed (for the purpose of avoiding disputation) that the deduction (or the relevant part of it) is 10% of the impairment, unless this assumption is at odds with the available evidence.' Section 323 of the 1998 Act provides a default or nominal deduction of 10% (1/10th) in circumstances where it is difficult or costly to determine the appropriate deduction although the legislation does not restrict the deduction to those specific circumstances. However the Panel concludes that neither the views expressed by the AMS or the medical evidence support the application of a nominal 10% (1/10th) deduction. Accordingly, in the Panel's view the AMS erred in applying this deduction in circumstances where the evidence suggests that a greater deduction should be applied. In this regard the Panel refers to the AMS's finding of 8% WPI for post 1 January 2002 injuries, the injuries claimed, the history provided and the available radiological evidence. In the Panel's view the application of a 1/10th deduction by Dr Lahz in the circumstances outlined above gives rise to a demonstrable error. Having found error the Panel proceeded to conduct its own assessment of the injuries referred by the Arbitrator." 18 In summary the Panel concluded that the assessment conducted by Dr Lahz contained an error insofar as the doctor applied s 323(2) of the Act when assessing the deduction for the previous injury. Having concluded that an error had occurred the Panel proceeded to make its own assessment. In the course of its reasons the Panel described the task which it believed it must undertake by reference to the functions under the Act of the Arbitrator and Authorised Medical Specialist. It said: "The Panel has considered the submissions. In relation to the submission that the AMS (and impliedly the Panel) is required to apply sections 15 and 16 of the 1987 Act the Panel refers to the decision in Wikaira v Registrar of the Workers Compensation Commission NSW & Anor [2005] NSW SC 94 which established that an AMS is required to accept findings of injuries and make an assessment on the basis that a compensable injury had occurred. The referral process for assessment of permanent impairment demonstrates (on its face) that an injury occurred on a particular date and in this instance the relevant dates of injury span the methods of assessment for pre and post 1 January 2002. The Panel notes that the referral as it relates to the nature and conditions claim does not contain a deemed date of injury but rather a time period in which the injury was found to have occurred. The Panel is bound by the referral of the Arbitrator as it is the process of referral which facilitates an assessment by the AMS which is 'conclusively presumed to be correct.' The Panel notes that no finding was made by the Arbitrator pursuant to section 4(b) of the 1987 Act notwithstanding that the 'Application to resolve a Dispute' indicated that the claim was brought pursuant to section 15 or 16 of the 1987 Act. In respect of the referral the Panel applies the authority of Comensoli v NSW Department of Juvenile Justice [2006] NSWWCCPD 138 in which it was held that: 'The referral of a medical dispute to an AMS pursuant to section 321 of the 1998 Act is a critical step in the determination of the rights and liabilities of parties to a workers compensation claim for lump sum compensation for permanent impairment ( Jopa Pty Limited t/as Tricia's Clip-n-Snip v Evenden [2004] NSWWCCPD 50). It is a matter that should be given careful attention. The content of the referral should be carefully checked by the Commission and the parties to ensure it is in accordance with the issues in dispute and in accordance with any findings of the Arbitrator or the Registrar. The referral itself should identify the nature of the 'medical dispute' that is being referred (section 319 of the 1998 Act) and the details of the injury, including any findings by the Arbitrator on the issue of causation and whether or not the worker's employment was a substantial contributing factor to that injury. Clearly there is nothing to be achieved by referring a medical dispute to an AMS for assessment where there is no liability established for the injury under the Workers Compensation Acts. Where an Arbitrator finds that an 'injury' has been established then the AMS assessment must be made on the basis of that finding ( Wikaira v Registrar of the Workers Compensation Commission of NSW & Anor [2005] NSWSC 954 at [20]).' Accordingly, the role of the Panel is not to make a finding as to causation or disease, particularly in circumstances where the Arbitrator has not made any such findings, but rather to review the decision of the AMS in accordance with the referral and any findings which have been made by the Arbitrator in determining that the dispute should be referred for assessment by an AMS. The role of the Panel is then to consider the medical evidence and, in this case, having found error, conduct its own assessment on the basis of the material available to the Panel or by admitting new evidence. The Panel considered the reports of other practitioners together with the history, investigations and findings on physical examination and concurs with the assessment provided by Dr Lahz of in respect of the total amount of permanent percentage loss of use or impairment of the Appellant's right leg at or above the knee, being 5% and the total amount of permanent impairment of the Appellant's back, being 10% as a result of his injuries occurring prior to 1 January 2002. Further, following its review the Panel has also formed the view that the Appellant has an 8% WPI of his lumbar spine as referred by the Arbitrator arising from post 1 January 2002 injuries. Accordingly the Panel confirms the assessment of Dr Lahz and notes that a finding of DRE Category II accords with the assessments of Dr Millons, Dr David and Dr Bodel. However, as stated having found a significant level of impairment pre 1 January 2002 it is inconsistent with the terms of section 323(2) of the 1989 Act to apply a 1/10 deduction. Therefore the Panel must now consider the deduction to be applied for a pre-existing injury, abnormality or condition. The Panel accepts that the method of deduction to be applied is not a precise measure as the methods of assessments of pre and post 1 January 2002 have no precise relationship. Accordingly regard must be had to the level of impairment found following the application of both method of assessment. In the Panel's view the finding of 10% permanent impairment of the Appellant's back is significant, particularly in circumstances where the assessment of post 1 January 2002 injuries is 8% WPI. In these circumstances a significant deduction is also warranted. Further the Panel considers that the Appellant's spinal x-ray studies demonstrated that vertebral wedging, narrowing of disc space and sclerosis was in existence in October 2002. These findings are consistent with an advanced degenerative process. In these circumstances the Panel has determined that the appropriate deduction pursuant to section 323 of the 1998 Act is 50% or one half. Therefore the Panel finds that the Appellant has a 4% WPI referable to the injuries found to have occurred post 1 January 2002. In respect of the submissions that Dr Bodel's report was not served by the Respondent as directed by the Arbitrator the Panel notes that the Respondent confirmed service of these reports on the Appellant in correspondence to the Commission dated 9 December 2004. On the evidence before the Panel service on this date accords with the Direction provided by the Arbitrator. Further the Panel has interpreted the Appellant's submissions to challenge compliance with the Direction rather than contend that the report of Dr Bodel was not received by the Appellant. In these circumstances the Panel is persuaded that the Appellant has been provided with a copy of Dr Bodel's report and has also been provided with an opportunity to address the report on appeal. Additionally the Panel confirms that it has arrived at its decision with reference to the medical evidence in totality and no specific reliance has been placed on any particular medical report. 19 Having dealt with the Certificate issued by Dr Lahz the Appeal Panel turned its attention to the certificate issued by Dr Taylor. The Panel accepted the plaintiff's submission that there was an internal inconsistency in the certificate which gave rise to a "demonstrable error" and proceeded to conduct its own assessment. That assessment resulted in a finding of 0% Whole Person Impairment and accordingly the plaintiff's appeal effectively failed on this issue. The Appeal Panel said: "MAC of Dr Taylor In the Panel's view the MAC issued by Dr Taylor (as amended) is internally inconsistent in that the AMS stated at page 8 that he assessed the Appellant's total percentage of permanent loss of use of sexual organs as at 60%. However the attached tables of assessment do not contain this figure in any entry. This internal inconsistency is sufficient to fundamentally disturb the integrity of the MAC and give rise to a demonstrable error. Having found error the Panel proceeded to conduct its own assessment of the injuries referred by the Arbitrator. The Panel considered the reports of other practitioners together with the history, investigations and findings on physical examination and concurs with the assessment provided by Dr Taylor in the Table of Assessment attached to the MAC in respect of the total amount of permanent percentage loss of efficient use or impairment of the Appellant's sexual organs, being 0%. This assessment is based on the history confirmed throughout the MAC and that contained in the report of Dr McMahon. Dr McMahon specifically referred to a discrete injury sustained by the Appellant on 10 October 2002 and noted that it was from this time onwards that the Appellant developed sexual problems. Dr Taylor provided a history in similar terms. The Panel is persuaded, on the medical evidence and the history provided that the Appellant did not observe any abnormality or loss of sexual functioning pre 2002. Rather loss of use of sexual organs commenced after the injury sustained on 10 October 2002 and accordingly finds a 0% permanent loss of efficient use of sexual organs. In respect of Dr Taylor's assessment of WPI referable to sexual organs in the post 1 January 2002 period the Panel again considered the reports of other practitioners together with the history, investigations and findings on physical examination and concurs with the assessment provided by Dr Taylor of 0% WPI. In this regard the Panel refers to the absence of any physical or neurological impairment as required in applying the Guides (page 321 paragraph 5.14). On balance the Panel is not persuaded that there is sufficient and consistent evident to support a finding that the Appellant sustained a rateable impairment of in respect of loss of sexual organs as a result of an injury referred by the Arbitrator in the post January 2002 period."

The present proceedings 20 The plaintiff claims in these proceedings that the Panel's decision was:

1. ultra vires in that it constituted an abuse of discretion and power in that it failed to take into account relevant considerations.

2. ultra vires in that it constituted an abuse of discretionary power in that it was unreasonable.

3. constituted an error of law on the face of the record.

4. constituted a denial of procedural fairness to the plaintiff. 21 The plaintiff seeks an order that the matter be remitted to the Panel for determination according to law.

The plaintiff's arguments 22 Section 328 of the Act provides for the procedure on an appeal to the Appeal Panel. It is in the following terms: "(1) An appeal against a medical assessment is to be heard by an Appeal Panel constituted by 2 approved medical specialists and 1 Arbitrator, chosen by the Registrar. (2) The appeal is to be by way of review of the original medical assessment. The WorkCover Guidelines may provide for the procedure on an appeal. (3) Evidence that is fresh evidence or evidence in addition to or in substitution for the evidence received in relation to the medical assessment appealed against may not be given on an appeal unless the evidence was not available to the appellant before that medical assessment or could not reasonably have been obtained by the appellant before that medical assessment. (4) When attending an Appeal Panel for the purposes of an assessment, an injured worker is entitled to be accompanied by a person (whether or not a legal adviser or agent) to act as the injured worker's advocate and assist him or her to present his or her case to the Appeal Panel. (5) The Appeal Panel may confirm the certificate of assessment given in connection with the medical assessment appealed against, or may revoke that certificate and issue a new certificate as to the matters concerned. Section 326 applies to any such new certificate. (6) The decision of a majority of the members of an Appeal Panel is the decision of the Appeal Panel." 23 The plaintiff submitted that the Appeal Panel was in error in relying on the decision of Wood CJ at CL in Campbelltown City Council v Vegan [2004] NSWSC 1129 without reference to the consideration of the approach to be taken to an appeal by the Court of Appeal in Campbelltown City Council v Vegan [2006] 235 ALR 342; NSWCA 284. In the Court of Appeal Basten JA reflected on the nature of the proceedings before an Appeal Panel and expressed the opinion that "on a tentative view, the approach adopted by the primary judge in the present case may have been in error and the powers of the Appeal Panel may be limited to addressing, and if thought necessary, correcting, errors identified in the certificate granted by the approved medical specialist as specified by the appellant." (at [137]) 24 His Honour did not reach any final conclusion on that aspect of the matter. 25 McColl JA agreed with Basten JA. Her Honour also agreed with Handley JA who, rather than expressing tentative views, provided a concluded view as to the operation of the relevant provisions of the Act. His Honour said: (at [15]-[19]) "Section 327 authorises an appeal from the assessment of a medical expert to a panel including other medical experts. The nature of an appeal, in the strict sense, to a superior court is well established. In Attorney General v Sillem (1864) 10 HLC 704, 724 [11 ER 1200, 1209] Lord Westbury LC said: 'An appeal is the right of entering a superior Court, and invoking its aid and interposition to redress the error of the Court below.' In The Commonwealth of Australia v Bank of New South Wales [1950] AC 235, 294 the Privy Council added an important qualification: '… an appeal is the formal proceeding by which an unsuccessful party seeks to have the formal order of a court set aside or varied in his favour by an appellate court.' Administrative appeals were unknown, or relatively unknown, in Australia and Britain in 1950, but are now common in both jurisdictions. Parliament by providing for such appeals must be taken to have intended that an appeal to a superior administrative body should be similar to an appeal to a superior court. Since an appeal is a means of redressing or correcting an error of the primary decision maker a successful appeal should produce the correct decision, that is the decision the original decision maker should have made. It is therefore an inherent feature of the appellate process that the appellate decision maker exercises, within the limits of the right of appeal, the jurisdiction or power of the original decision maker. Hence in Parramatta CC v Palmyra Freeholds Pty Ltd [1974] 2 NSWLR 83, 87 Reynolds JA, giving the principal judgment of the Court, said: 'It may be stated as a general proposition that an appellate tribunal is not, in the absence of express provision, invested with power to do that which the subordinate tribunal could not have done.' So called appeals may take a number of different forms which were identified by Glass JA in Turnbull v New South Wales Medical Board [1976] 2 NSWLR 281, 297-8, although judicial review and motions for a new trial based on fraud or fresh evidence invoke an exercise of original jurisdiction. If the appellate tribunal, like the Appeal Panel, is entitled to receive additional evidence its jurisdiction will be original and not strictly appellate when such evidence is acted on." 26 The tentative view expressed by Basten JA has caused some difficulties and this Court has been urged in a number of cases to follow it. In Smith v Liquip Services Pty Ltd & Ors [2007] NSWSC 687 Hoeben J expressed the view that trial judges should follow the tentative approach suggested by Basten JA. (see to the contrary Harrison AssJ in Lukacic v Vickarini Pty Limited & Anor [2007] NSWSC 530). Malpass AssJ in Skillen v MKT Removals Pty Ltd [2007] NSWSC 608 expressed the approach which he believed this Court should take in the following terms: (at ([20]-[25]) "It would seem to be intended that what is described as a "review" conferred by the sections (like that which is conferred by the Rules) is, at least in part, in the nature of an appeal. The statutory regime not only limits the grounds of appeal to four categories, but also requires an identification of those that are relied on. The statutory regime does not require the Registrar to address all of the grounds for appeal. It suffices for the Registrar to be satisfied that at least one of them has been made out. If that happens, only then does the appeal proceed to a Panel (which can address and correct error). In this statutory context, it does not seem to me that it was intended that the review be a hearing de novo (a completely fresh hearing at large in which the power of the Appeal Panel may be exercised regardless of error). See, inter alia, Allesch v Maunz (2000) 203 CLR 172 at 180-181 . I observe also that there may not be a hearing as such (as in this case, it may be determined on the papers) and the Appeal Panel has restricted powers. I prefer the view that the grounds for appeal impose a restraint on the scope of the review that is to be conducted by the Appeal Panel pursuant to s 328. I further take the view that the matters in issue may be further narrowed by that which may arise from submissions made in respect of the grounds for appeal. Even if a different view were to be taken in respect of any of those matters, it seems to me that it would be a denial of natural justice for the Appeal Panel to deal with matters falling either outside the scope of the grounds of appeal or the submissions without first giving the parties the opportunity to be heard concerning them." 27 As I understand his Honour the approach to the task of the Appeal Panel taken by Malpass AssJ is generally consistent with the approach described by Handley JA. It requires the Appeal Panel to address the elements of any certificate challenged in an appeal and, if it is satisfied that an error has occurred, review the matter and exercise the power in s 328(5) to confirm the certificate or revoke it and issue a new one. In exercising its powers the Panel is required to examine for itself the medical evidence and may receive fresh evidence pursuant to s 328(3). As 328(4) contemplates the Appeal Panel is to undertake its own medical assessment. 28 In the present case although the Appeal Panel cited the judgment of Wood CJ at CL the process it followed was consistent with that described by Handley JA in the Vegan appeal. It proceeded to consider the grounds of appeal, satisfy itself that an error had occurred and then conducted its own assessment having regard to the medical reports before it. 29 The plaintiff submitted that the Appeal Panel was bound to follow the procedure contemplated by Basten JA's "tentative view" which it was submitted would require the Appeal Panel to confine its deliberations to the error acknowledged by the Registrar pursuant to s 327(4) and/or by the contentions raised by the plaintiff in submissions. As I understand the submission, the plaintiff says that with respect to Dr Lahz the plaintiff had confined his challenge to an argument that the Doctor had erred in her findings as to the extent of injuries which were the responsibility of the first defendant. The plaintiff had made no submission to the Appeal Panel in relation to the operation of s 323(2) and accordingly, it was submitted that the Appeal Panel could not review that aspect of Dr Lahz' certificate. 30 In my opinion, this submission must be rejected. I do not understand Basten JA's view to be that all forms of merit review were excluded by the Act. Such a view would not be consistent with s 328(2) which gives a power to "review", s 328(3) which provides a power to admit fresh evidence and the power to issue a fresh certificate pursuant to s 328(5). By providing that the appeal Panel may conduct its own assessment and issue a new certificate the process contemplated by the section requires the Appeal Panel to arrive at the correct decision on the merits. 31 I accept that Basten JA's "tentative view" may confine the Appeal Panel's function to reviewing a medical assessment and correcting errors in relation to matters raised by the appellant. However, in so doing it may review the available evidence, including any fresh evidence provided to it in accordance with s 328(2). Understood in this manner Basten JA's view would be consistent with that expressed by Handley JA. The Act provides for merits review, but, of the matters raised by the appellant. This is the approach taken by Malpass AssJ. If I have misunderstood Basten JA's view it seems to me I should follow the approach favoured by Handley JA, and agreed in by McColl JA rather than the tentative view of Basten JA.

Can the plaintiff succeed in the present proceedings? Dr Lahz 32 As I have already indicated the Appeal Panel accepted Dr Lahz' finding that the plaintiff suffered a 10% impairment of his back attributable to the nature and conditions of his employment prior to 1 January 2002. However, when considering the extent of injury post 1 January 2002 the Appeal Panel concluded that a pre-existing impairment of 10% should result in a reduction of more than 1/10 and concluded that the appropriate reduction was 50%. In my opinion, as the plaintiff had sought a review by the Appeal Panel of the certificate given by Dr Lahz because the decision of the Medical Specialist is affected by "legal, factual and discretionary error", it was open to the Appeal Panel to reach this conclusion. In so doing it was exercising the power of review provided by s 328. 33 The source of the difficulty which resulted in Dr Lahz' conclusion is s 323(2) of the Act. Section 323(1) provides for a deduction for any proportion of permanent impairment that is due to a previous injury or pre-existing condition. Because of the difficulties which will commonly attend the quantification of that proportion s 323(2) provides that if the task "will be difficult or costly to determine (because, for example, of the absence of medical evidence)" it may be assumed that the deduction is 10% of the impairment unless this assumption is at odds with the available evidence. In her report Dr Lahz applied the 10% reduction in the apparent belief that s 323(2) obliged her to follow this course. However, this section only operates in the event of excessive difficulty or cost in making the appropriate assessment.

Procedural Fairness 34 The plaintiff submitted that, before the Appeal Panel could reach a decision which varied the reduction in a manner adverse to the plaintiff, it was required to give notice to the plaintiff that it was considering this course and allow him an opportunity to make further submissions. It was submitted that to do otherwise would be unfair: Kioa v West (1985) 159 CLR 550 (at 583). 35 The first defendant accepts that the Appeal Panel was bound by obligations of procedural fairness. However, the content of the obligation will depend upon the circumstances of the particular case. 36 In this case the plaintiff challenged before the Appeal Panel the certificate provided by Dr Lahz. An essential issue which Dr Lahz was required to consider was the proportion to be deducted for pre-existing injury when determining the degree of Whole Person Impairment. That issue had been considered in medical evidence placed before Dr Lahz. In the submission on behalf of the plaintiff in support of the appeal it was submitted that Dr Lahz had erred in her approach to the deduction and it was submitted that her finding should be reviewed, there being "legal, factual and discretionary error." The plaintiff's argument was that because his injury had occurred over time during his work history of heavy duties his most recent employer should be liable for his injuries and a discount should not be made. The plaintiff relied on the decision of the Court of Appeal in Crisp v Chapman (1994) NSWCCR 492. 37 The appropriate amount of the deduction for pre-existing injury, if any, was the issue raised with the Appeal Panel. Although a decision-maker must disclose information which might affect the decision which does not come from the applicant (Kioa v West at 587,628) the decision of the Appeal Panel turned upon material known to the applicant. It may be that if the conclusion reached by the Appeal Panel was obscure it should have disclosed its tentative view to the plaintiff: Commissioner for the Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576; Re Minister for Immigration and Multicultural and Indigenous Affairs: ex parte Palme (2003) 216 CLR 212 and SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 81 ALJR 515. A decision-maker may be obliged to advise of a prospectively adverse conclusion "not obviously open on the known material" or which may not be apparent from "its nature of the terms of the statute under which it is made." However, a decision-maker "is generally not obliged to invite comment on the evaluation" of a person's case. (Alphaone at 591 approved in Palme [22]). Having asked for a review of the Certificate the plaintiff initiated a process by which the Appeal Panel could determine to issue a new certificate which, after consideration of the relevant material, reflected its view of the matter. 38 In Thompson v WorkCover Queensland [2002] QSC 119 the Supreme Court of Queensland rejected a submission that the General Medical Assessment Tribunal denied a claimant procedural fairness by failing to bring to her attention an inclination to find that her symptoms had been exacerbated during her employment but that these symptoms were not related to the employment. Cullinane J held that the very issue which brought the claimant before the Tribunal was whether she had suffered an injury, and that this necessarily involved the issue of whether her employment caused the injury, as required by the statutory definition (at [37]): "It is settled that a body in the position of the Tribunal is not obliged to give notice of any impression it might have formed of the evidence or of the lines along which it might be thinking so that a party might have the chance to persuade it otherwise." 39 In my opinion the requirements of procedural fairness are not to be applied after dissection of each component of the medical assessment reflected in the certificate, treating each as a discrete issue. That would be an artificial and unwieldy approach to the medical assessment and contrary to the approach in Alphaone. Such an approach would not be appropriate in the statutory context which requires efficient, effective and timely resolution of workers compensation claims (ss 3(f), 354(1)-(3), 367(1),(a),(b),(c)). The common law requirements must be applied having regard to these statutory requirements. 40 As the first defendant submitted if procedural fairness required the Appeal Panel to disclose to an appellant worker that it proposed to decrease a Whole Person Impairment by reason of its assessment that a higher proportion should be deducted by reason of a pre-existing injury, then it would also require the Appeal Panel to disclose to a respondent employer that it proposed to increase a Whole Person Impairment by reason of its assessment that a smaller proportion should be deducted for a pre-existing injury. However this would encroach upon the thinking and evaluation processes of the Appeal Panel, which according to Alphaone, are not required to be disclosed. The duty of disclosure should be the same whether the Appeal Panel is proposing to make a decision unfavourable or favourable to an appellant worker. Procedural fairness does not require the Appeal Panel to disclose to an appellant worker that it proposes to increase or decrease a Whole Person Impairment because it has reached a view different from the Accredited Medical Specialist as to the degree of Whole Person Impairment. Nor does it require the Appeal Panel to disclose in advance for comment its evaluation of the proportion of deduction which is appropriate in respect of pre-existing injury.

Dr Taylor 41 The plaintiff submitted that the Appeal Panel had also erred in the manner in which it dealt with the challenge to the finding in relation to the impairment of the plaintiff's sexual organs. The essential complaint arises from the remarks of Dr Taylor which I have included in [8] of these reasons. Dr Taylor originally expressed his opinion that the plaintiff had a Whole Body Impairment in respect of his sexual organs of 0% before he had been provided with the medical assessment and report of Dr Lahz. He was later provided with Dr Lahz' material but did not alter his own report or certificate. It is unclear whether, after he was provided with Dr Lahz' report, he reconsidered his initial opinion, although it would be unlikely that he would have offered a further report which referred to it as having been considered and not reviewed his own opinion. The plaintiff's fundamental complaint is that Dr Taylor did not provide an opinion which was dependent upon further consideration of the available orthopaedic evidence. 42 The Appeal Panel effectively accepted the plaintiff's submission as to the internal inconsistency and formed the conclusion that the Assessment Certificate issued by Dr Taylor was defective because the doctor had stated in his report that he assessed the total percentage of permanent loss of sexual organs as 60% but the tables of assessment did not contain this figure. For this reason it was satisfied that there was demonstrable error. 43 Being satisfied that there was error the Panel made its own assessment and for that purpose considered all of the available medical evidence. It concluded from this material that the plaintiff's sexual difficulties related to the injury which he sustained on 10 October 2002 and was not related to any earlier injury. This finding was open to it. 44 The Appeal Panel accepted that when ultimately assessed by Dr Taylor the plaintiff was suffering from a 60% loss of the use of his sexual organs. However, the evidence was that this was not due to any physical or neurological impairment of those organs and accordingly under the regime provided after 1 January 2002 was not compensable by reason of applicable Guidelines page 321 para 5.14 which provide as follows: "Assessment of sexual functioning (AMA Chap 7, pp 143-171): Impotence should only be assessed as an impairment where there is objective evidence of spinal cord, cauda equina or bilateral nerve root dysfunction or limbo-sacral plexiopathy. There is no additional impairment rating for impotence in the absence of objective clinical findings." 45 That finding was also open to the Appeal Panel.

Reasons 46 The plaintiff complained that the Appeal Panel failed to give sufficient reasons for its decision in relation to Dr Taylor. The obligation to give reasons was confirmed in Vegan. However, the reasons need not be extensive or unnecessarily detailed but sufficient for the reader to understand why the Appeal Panel reached a particular conclusion. In the present case I am satisfied that the Appeal Panel discharged this obligation in relation to the appeal with respect to the certificate issued by Dr Taylor.

Relief 47 Accordingly, in my view it is appropriate to make the following orders:

1. Summons dismissed. 2. Plaintiff to pay the first defendant's costs. **********

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